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Retail Roundup Report

Policy Updates • Economic News • Retailer Responses • Economic Indicators

What's in this report?

This ‘newsletter-style’ report provides you with key monthly updates as to what’s happening in the UK retail and leisure industry. It keeps you abreast of the latest:

  • • Retail news & stories
  • • Updates by category & channel
  • • Latest economic indicators
  • • Key retail dates throughout the month & more…

Succinct, punchy, need-to-knows for professionals in retail, leisure and retail-related industries.


Retail Roundup Report - Retail Economics


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Retail Roundup Report - Retail Economics


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Example insights

Economic Update

Grocery inflation slows marginally

Grocery price inflation fell to 6.8% in January, down from 6.9% in December 2023, according to Kantar. This is a softer decline that the 2.2pp fall seen between November and December.

Take-home grocery sales increased in value by 2.9% in the four-week period. Items bought on offer accounted for 27% of all grocery spending in Jan compared with 32% in Dec, reflecting relatively heavier discounting over the Christmas period.

As households alter their spending behaviour in response to high living costs, Kantar found that 86 million more lunchboxes were brought to work in 2023.

Dry January also had an impact on alcohol sales, which fell by more than half compared with the previous month, with almost 6% of packs of beers sold in the month being no or low-alcohol versions, up from 4% at the end of 2023.

Veganuary further resulted in an 8% increase in sales of own label plant-based items. However, the impact of sales of health-related items was softer on the whole compared with previous years, pointing to the spread of spending on this area beyond an initial January spike.

Looking ahead to February, grocery sales will be impacted by consumers’ spending for Valentine’s Day and the extent to which this is cut back.



Mortgage approvals rise

Annual growth in unsecured lending rose by 8.5% in December from an 8.6% rise last month.

Consumers borrowed an additional £1.2bn in consumer credit on net, falling from last month’s £2.1bn.

The easing was driven by borrowing through credit cards which fell to £0.3bn in December from £1.0bn in November. Net borrowing through other forms of consumer credit edged lower to £0.9bn in December (from £1.1bn last month).

Mortgage approvals for house purchases rose to 50,459 in December, from 49,313 in November. This was the highest figure since June and ahead of the previous six-month average of 48,460.

Individuals repaid, on net, £0.8bn of mortgage debt in December compared to zero in November.

Notably, the annual growth rate for net mortgage lending was flat for the first time on record.




Food & Grocery

Electronic shelf labels - Lidl is replacing paper pricing tags with electronic shelf labels across UK stores to improve efficiency as colleagues will spend less time updating price tags manually. The retailer also claimed the move will save over 206 tonnes of carbon annually as a result of reductions of paper and packaging. staff training.

Potential strike - GMB union members at Asda stores in Brighton Marina and Brighton Hollingbury are considering whether vote for strike action over issues including poor contracts, health and safety issues and inefficient staff training.

Supporting farmers - Lidl unveiled plans to invest £70m in long-term contracts of up to three years to support British farmers amid challenging weather conditions. It forms part of the retailer's broader aim to invest £17bn into the British food industry by 2025.

Media network - The Co-op launched Co-op Media Network together with its long-term agency partner Threefold, making it the first in the UK convenience sector to launch its own retail media network. The network aims to help brands access a greater range of audiences as well as creating more relevant advertising for its shoppers.

Appointment - BP appointed former Marks and Spencer franchise director David Phillpot to the newly created role of convenience trading director for Europe. Phillpot is set to play a key role in overseeing the growth of the company's European network of over 3,000 convenience stores.





Clothing & Footwear

Financial Updates - Superdry saw sales fall 23.5% to £219.8m in the 26 weeks to 31 October 2023. Adjusted pre-tax loss increased to £25.3m from £13.6m in the same period last year, with statutory pre-tax profit coming in at £3.3m. The retailer attributed to the performance in particular to poor wholesale performance, challenging market conditions and unseasonal weather, issuing a profit warning as a result.

Supply issues -  Matalan acknowledged facing stock issues arising from instability in the Red Sea. The retailer did not reveal which product categories are being affected but stated that it has plans to reduce the impact on consumers.

Potential CVA - Ted Baker owner Authentic Brands Group is reportedly set to appoint advisers on a potential restructuring of the company with the aim of reducing spending on rent. Cost-saving measures such as a potential CVA are thought to be under consideration, which could result in rent reductions and store closures.

Sector expansion - Marks & Spencer started selling Puma and Reebok products on its sportswear platform The Sports Edit, which now offers five of the top 10 global sportswear brands. Over 140 products from Puma and Reebok will be introduced over the next two months.
Potential takeover - Superdry chief executive Julian Dunkerton confirmed that the company will be looking into a possible buyout, seeing its share price surge on 2 February as a result.

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Health & Beauty

Financial update The Fragrance Shop saw sales climb 6.5% in the 13 weeks to 31 December 2023, driven by successful new fragrance launches, as well as range extensions, its gift set collection and strong seasonal demand. The retailer also saw its MyTFS subscription programme grow significantly in the period.

Job cuts - THG is reportedly planning to lay off 60 marketing and sales employees at its Ingenuity services platform, as well as 100 employees at its Warrington warehouse due to the automation of its factories.

Global branding - Sephora is rolling out a single brand signature across all of its 35 markets located in Europe, the Middle East and Asia. The retailer's slogan "we belong to something beautiful", which has initially been used in North America, will now be used globally.

Liquidation – Lloyds pharmacy went into liquidation, still owing debt worth £293m to creditors. The retailer was acquired by private equity firm Aurelius in 2021 and appointed Turpin Barker Armstrong Accountants on 16 January to oversee the liquidation proceedings.






Proposal rejected - Currys rejected a takeover proposal from US investment firm Elliott Advisors on the grounds that it had been undervalued. It comes as the retailer upgraded its adjusted pre-tax profit guidance from £105m to £115m despite seeing a 3% fall in like-for-like sales in the 10 weeks to January.
Jobs saved - AO acquired certain assets of mobile phone retailer A1 Comms, which went into administration this month, for £2.2m. The retailer bought the assets and intellectual property rights to the websites Affordable Mobiles, Buy Mobiles and Mobile Shop. 73 jobs were saved as a result of the acquisition.
Investment - EE plans to invest £6m into its UK store estate over the next year, planning to open more than 10 of its new-format experiential stores between April 2024 and March 2025. These stores will include a welcome zone, gaming zone, base camp and a technology corner. It comes as the company's flagship store at Westfield London, White City, which opened in June 2023, saw a 250% increase in footfall when compared with its previous store at the same location.





Department stores, marketplaces and specialists

Partnership - Amazon's European fashion wing Luxury Stores at Amazon in Europe is partnering with luxury resale platform Hardly Ever Worn It to offer customers in the UK, Germany, Spain and Italy pre-owned items from luxury brands. Products available will include womenswear, shoes, accessories, jewellery and watches, while a pre-screening process created by the platform is designed to ensure high quality.

Strike action - Amazon workers at the company's Coventry depot are thought to be set to strike again this month following a compulsory re-ballot. The last strike took place on Black Friday, while workers at the Birmingham depot began their first round of strike action on 25 January.

Transformation - Poundland is set to bring in 2,000 new general merchandise lines across its more than 850 stores across the UK and Ireland, with the ranges facilitated by the retailer's parent company Pepco Group. Each store will hold an event in the coming weeks to introduce shoppers to the new range, which will include homewares, containers, toys and technology.





Economic indicators

Key economic indicator charts are features every month which gives you an instant gauge on month-on-month, year-on-year changes: UK Core PPI, UK Real average weekly earnings, UK Consumer Price Index, UK vacancies.

Economic Indicators

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