Skip to main content

UK retail profits to shrink by £8bn, new research says

// UK retail profits to shrink by £8bn by 2025
// This would come as a result of the increased shift to online in the wake of Covid-19
// Pre-tax profit margins are forecast to fall to 3.2% by 2025

New research has found that UK retail profits are expected to shrink by £8 billion by 2025.

This would come as a result of the increased shift to online retail in the wake of the Covid-19 pandemic, according to a report by global professional services firm Alvarez & Marsal (A&M), in partnership with Retail Economics.

Pre-tax profit margins are forecast to fall to 3.2 per cent by 2025, compared to 3.7 per cent in a ‘no Covid’ scenario where the trajectory for consumer behaviour would have remained unchanged.

READ MORE: Shop prices slide further in June

The lasting impact of Covid-19 will not be felt equally across all retail categories, with some businesses significantly more vulnerable to pressures on profit margins than others.

Almost 20 per cent of spending across apparel, homewares and electricals is expected to permanently shift online.

These changes will be felt most by retailers with a presence in the UK, with four in 10 consumers stating that their shopping habits will change permanently – the highest across Europe.

“Covid-19 has wrought irreversible change which has left the future of many retailers hanging in the balance,” A&M managing director, Richard Fleming said.

“Those businesses that will remain relevant and survive the disruption will be those that are able to realign operating models with the new normal and meet the needs of a post-pandemic consumer – but there will be an inevitable shake out of those that cannot do so before it’s too late.”

Click here to sign up to Retail Gazette’s free daily email newsletter

The post UK retail profits to shrink by £8bn, new research says appeared first on Retail Gazette.



from Retail Gazette https://ift.tt/3x6wsFr
via IFTTT
Labels:

Comments

Post a Comment

Popular posts from this blog

Eagle Labs launches impirica CBD brand

ST. PETERSBURG, Fla. — Eagle Labs has launched impirica, a new brand of CBD intended to eliminate consumer fear, and increase confidence, in trying the exciting new cannabidiol category. Michael Law Although most Americans have now heard about CBD, many are very confused and concerned about product quality. This is inhibiting trial in the category and holding back conversion into sales. In fact, a 2017 study by Johns Hopkins University found that two out of three CBD products on the shelf did not contain the amount of CBD reflected on the label. Furthermore, in 2018 and 2019, the FDA sent notices to a substantial number of CBD manufacturers advising them of serious concerns about product quality or egregious medical claims. The impirica brand looks different than most CBD brands — the brand name itself connotes testing and trust, says Eagle Labs chief commercial officer Michael Law. “It doesn’t use the traditional category colors of browns and greens, and you won’t find a hemp...
70 comments
Read more

Sagar Daryani, CEO and Co-founder – Wow! Momo & Saga: From a Kiosk to a Kingdom

Sagar Daryani’s entrepreneurial odyssey from humble beginnings to pioneering success has redefined the landscape of food startups in India. Co-founding Wow! Momo, he has spearheaded the growth of the largest indigenous QSR chain in the country, crafting a remarkable saga of triumph The Genesis: A Visionary Venture Takes Root In 2008, armed with a mere Rs. 30,000 and boundless ambition, Sagar Daryani and Binod Homagai embarked on their entrepreneurial journey while still pursuing their graduation in B.Com Hons from St. Xavier’s College, Kolkata, even before their college results were out. They knew the value for money and boot-strapped to plough back profits and grow their venture. Sagar spearheaded brand expansion, brand creation, and marketing and retail operations. Grew across the city with a strong consumer focus. The early days were hard but keeping track of the money flow was even harder. Believing in the concept of ‘1 rupee saved is 5 rupees earned’, and the lessons they lear...
1 comment
Read more

Homegrown ice cream chain HOCCO to open 250 stores, eyes Rs 400 crore by FY26

Ankit Chona, Founder and Managing Director of HOCCO, delves into the company’s revenue model, growth strategies, and vision for the future… Bengaluru: HOCCO (House of Chonas Collaborative) , the Ahmedabad-based ice cream and quick-service restaurant (QSR) chain, boasts a rich legacy spanning over 70 years, with roots tracing back to pre-independence India. The Chona family has been deeply entrenched in the food industry since 1944, originally operating in undivided Pakistan. Following the Partition, Satish Chona , an engineer with British Overseas Airways Corporation, relocated from Karachi to India. After journeying through multiple cities, he ultimately settled in Ahmedabad, where he established his first QSR outlet in 1953. Three decades later, he expanded into the casual dining segment, launching a restaurant in Baroda while continuing the family’s ice cream manufacturing business. However, in 2017, the company sold its ice cream division to a South Korean firm, shifting its fo...
Post a Comment
Read more