Challenges face many independent retailers in 2024

The High Street is still having financial issues…

Many independent retailers across the UK faced a difficult start to 2024 according to a new survey by Bira, the British Independent Retailers Association and the Association of Cycle Traders (ACT). The associations’ first Heartbeat survey asked members about their trading performance in the first quarter of 2024 (January to March) compared to the previous quarter (Q4 2023) and the same period in 2023.

It also gauged confidence levels for Q2 2024 and the full year, as well as the impact of the national minimum wage (NMW) increase in April.

Andrew Goodacre, CEO of Bira:

“These findings highlight the challenges facing many of our independent retail members as they navigate rising costs and economic pressures. The increase to the national minimum wage in April has been a further strain, with over a third saying it has negatively impacted their business. Additionally, nearly a quarter have been forced to reduce staff hours or headcount as a result of the higher wage floor. However, we were encouraged that over a third of members still managed to grow their sales in Q1 2024 versus the previous year, but margins have been squeezed due to increased business costs and wage increases.”

Andrew Goodacre, CEO of Bira

Bira, which works with over 6,000 independent businesses of all sizes across the UK, found that 46.5% of respondents said their Q1 2024 trading was somewhat or much worse than Q4 2023. However, over a third (35.6%) reported somewhat or much better performance versus the previous quarter. Year-on-year, the picture was more mixed, with 35% saying Q1 2024 was somewhat or much better than Q1 2023, but 46% reporting somewhat or much worse results compared to the same period last year.

Looking ahead, confidence for Q2 2024 is relatively low, with 42.6% feeling somewhat or highly unconfident about April to June. Just 27.8% are somewhat or highly confident, while 29.7% are neutral.

Andrew Goodacre, CEO of Bira:

“With confidence for Q2 and the full year remaining subdued, we will continue supporting our members through these tough trading conditions. Nurturing vibrant independent retail communities is vital for strengthening local economies across Britain,”

The survey data also indicated that 32.4% of respondents had experienced higher-paid staff asking for pay rises following the NMW increase, while 19.6% do not employ anyone on the minimum wage.

Mr Goodacre added that with the General Election now being called for July 4, will make for an interesting few months ahead for traders across the country, but has called for all parties to have the high street focus in mind when looking at their plans for change in 2024.