Skip to content
Search
AI Powered
Latest Stories

Retailers must brace for 'spending squeeze' as consumer confidence 'nosedives'

Retailers must brace for 'spending squeeze' as consumer confidence 'nosedives'

Retailers could find themselves facing a New Year spending squeeze as public confidence in the state of the economy took a nosedive, show recent industry data.

According to BRC-Opinium data released today (23), consumer expectations over the next three months of their personal financial situation remained at -3 in December, the same as in November.


Confidence in state of the economy worsened to -27 in December, down from -19 in November. Confidence on personal spending on retail also fell while confidence in personal spending overall dropped to +11 in December, down from +17 in November.

Helen Dickinson, Chief Executive of the British Retail Consortium, said,“Public confidence in the state of the economy took a nosedive, falling 8pts to -27.

"This created a widening gap between expectations of the economy and of people’s own finances, which remained unchanged. Perceptions were heavily skewed by age, with 18 to 35 year olds considerably more upbeat than older generations on both questions.

"The public’s spending intentions – both in retail and beyond – dropped 6pts, with expectations of spending in nearly every retail category falling. If these expectations are realised, retailers could find themselves facing a New Year spending squeeze just as they unveil their January sales.

“The weak spending intentions could pave the way for a challenging year for retailers, who face being buffeted by low consumer demand and £7bn of new costs from the Budget set to hit the industry in 2025."

Dickinson added that with sales growth unable to keep pace, retailers will have no choice but to raise prices or cut costs – closing stores and freezing recruitment.

"To mitigate the impact this will have on growth, Government must ensure that its proposed business rates reform does not result in any shops paying higher rates than they already do," she said.

More for you

Cadbury, Mars, and Terry's chocolate products with higher prices and smaller sizes due to shrinkflation.

Shrinkflation hits chocolate prices

iStock image

Shrinkflation hits chocolate prices

Prices of some chocolate products have risen by 50 per cent in a year while many have also shrunk in size, states a recent report, raising the concern of shrinkflation among shoppers ahead of Easter celebrations.

The latest report by Which?, the price of eggs made by big names including Cadbury, Mars and Terry’s have risen by as much as 50 per cent in some cases while some have also shrunk in size, according to research by consumer champion Which?.

Keep ReadingShow less
Tŷ Hywel launch of 2025 ACS Welsh Local Shop Report on March 26
iStock image

New report shows value of Wales' convenience stores

Almost all convenience stores in Wales engaged in some form of community activity last year, shows a latest report, shedding light on the value that Wales’ 3,000+ convenience stores provide as community hubs, local employers of over 26,000 people, and significant contributors to the Welsh economy.

Association of Convenience Stores (ACS) has officially launched its 2025 Welsh Local Shop Report, celebrating the key contributions that Welsh convenience stores make to their communities.

Keep ReadingShow less
UK inflation at 2.8% in Feb 2025 before Rachel Reeves’ budget speech
iStock image

Inflation dips as experts warn of future spikes

British inflation slowed more than expected in February, bringing some relief to consumers ahead of a likely new pick-up in price growth and to finance minister Rachel Reeves before her budget update speech today (26). However, analysts have warned that it inflation will be pushed again soon due to costs arising from the Budget.

Consumer prices rose by 2.8 per cent in annual terms in February after a 3.0 per cent increase in January, the Office for National Statistics said, as clothing and footwear prices fell for the first time in more than three years.

Keep ReadingShow less