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Retail sector in the UK

Published Monday, October 29, 2018

Key data and pressures facing the retail sector in the UK.

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Retail in the UK

The retail sector is going through a prolonged period of upheaval. Factors such as changing consumer behaviour, increased internet shopping and challenging economic conditions are changing the way retailers operate and engage with their customers.

This briefing paper describes the current state of the retail sector in the UK using data and recent reports on the industry. The pressures on the sector mentioned above are also explored. This paper does not provide information on government policy in the retail sector.

Key figures

Retail sector economic output was £92.8 billion in 2017

Growth

Retail sector employment was 2.8 million in 2017

Employment

There were 319,000 retail businesses in 2018

Retail sales

In 2017, retail sales in the UK were worth £395 billion. For every pound spent:

39 pence was spent in food shops

12 pence was spent in clothing shops

9 pence was spent on automotive fuel

8 pence was spent in household goods shops (including electronics and furniture stores)

Volume of sales

Internet sales

In January 2008 (when this data series begins), internet sales accounted for 5% of retail sales. In August 2018, internet sales accounted for 18% of all retail sales.

Internet sales

Internet retailing is more popular in the UK than in any other EU country. In the UK 82% of residents made at least one online purchase in 2017, similar to the proportion in Sweden, Demark, Luxemburg and the Netherlands. In Germany, 75% of residents made online purchases in 2017. The figure for Ireland is 53%, below the EU-28 average of 27%. The figure for Romania is 16%, the lowest in the EU-28.

Internet sales in the EU

Store closures

In the year to August 2018, 28 retail companies with multiple stores have ceased trading, affecting 2,085 stores and 39,000 jobs according to the Centre for Retail Research (note that this should not be interpreted to mean that this many jobs have been lost).

The Local Data Company found that 11.2% of retail premises were vacant in the second half of 2017, up from 11.0% in the first half of 2017. This is the first time that the ‘vacancy rate’ has risen since the Local Data Company began collecting this data in 2012.

Vacant retail units

Commons Briefing papers SN06186

Author: Chris Rhodes

Topics: Industry, Service industries

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