The United Kingdom has one of the biggest retail markets in Europe with London holding the highest concentration of retail activities and being the largest importer. The industry is expected to continuously grow driven by grocery retailing and owing to the increase in Internet retail. The country also has the largest Internet retail market in Europe and this too is exhibiting steady growth.
In 2014, the UK grocery retail sector was valued at 163 billion pounds.
United Kingdom as the fastest growing economy in EU
One of the characteristics of the UK market is that they have high consumer confidence. In 2015, consumer confidence in the nation reached its highest level in years, and with the growing retail market, it is expected to increase. This is backed by the growing economy of United Kingdom. As the economy grows, major industries follow. Hence, based on economic indicators, there have been significant improvements in the UK retail industry, GDP growth, disposable income, and employment rate.
The UK retail market profile
The United Kingdom is the biggest market for online retailing within the European Union. Over the years, internet retailing has been on a steady increase. This is the major contributing factor for the growth of the UK retail sector giving birth to Omni-channel developments like click and collect service and m-commerce. In 2015, consumers spent about £116 billion via their internet retailing habits. The biggest market players in the sector include Tesco, Amazon, and Ebay.
Today, in-store purchase accounts for about 90% of UK retail. There are about 280,000 stores in the country. Half of the retail market is captured by grocery retailers which include Sainsbury’s and Morrisons, Asda, and Tesco. The continuous growth of the retail market is attributed to the many successful distribution models.
The other sector that accounts for the 2nd higher shade in the retail industry is the clothing and footwear.
In 2014, the non-grocery value share included the following:
- Clothing and Footwear (29%)
- Leisure (21%)
- Home and Garden (19%)
- Health and Beauty (15%)
- Electronics (13%)
- Other (3%)
The country has 5 major retail spending cities which include London, Glasgow, Birmingham, Manchester, and Liverpool. Over the years, the sales in regional cities have significantly improved.
With the industry exhibiting positive growth and as the country is expected to have continuous economic growth, there are various opportunities in the retail market, especially for foreign brands. As per consumer confidence along with other economic indicators, it is expected that the UK retail scene is set to thrive, which is definitely a positive thing for the market entry of current and upcoming business brands.