Unlocking Retail Profitability:

Transforming a Cost Crisis
into a Competitive Edge

UK retailers face a £5.6 billion surge in costs this financial year – equivalent to 195,000 full-time retail jobs.

This data-led report by Retail Economics and YOOBIC quantifies the true impact of the Budget on the UK retail industry and reveals mitigation strategies to protect profitability.

Retail Economics Retail Profitability Report

Download the
research report

Get clarity on what’s coming and how the retail sector is responding

UK Retailers are expected to take a £1.76bn hit to profit in 2025/26, representing a 6.7% drop in industry profits year-on-year. Retailers will use a range of different measures, including pricing adjustments, operational efficiencies, and cost absorption, to maintain competitiveness.

Inside this research report you'll find:

A breakdown of projected
cost increases

How the rise in wages, tax contributions, and business rates is expected to affect UK retailers by size and sector.

Benchmark data on
mitigation strategies

How peers across the industry are adjusting pricing, restructuring operations, and investing in productivity.

A case study from
Home Bargains

Insights from Paul Rowland, Retail & Technology Director at Home Bargains, on balancing cost pressure with continued investment in the frontline.

“With operating costs rising sharply, many retailers have little choice but to absorb some of the financial pain while cautiously passing costs onto consumers already facing their own pressures. The scale of this challenge risks stalling investment, accelerating store closures, and reshaping the retail landscape in the year ahead.”

Richard Lim, Chief Executive Officer at Retail Economics

Download the Report and take the next step in navigating 2025’s high-cost environment

DOWNLOAD THE REPORT

About Retail Economics

Retail Economics is an independent research consultancy specialising in the UK retail and consumer sectors. It provides actionable insights through proprietary data and rigorous analysis, helping businesses navigate the complex retail landscape.

Offering a subscription service, consultancy, and data tools, Retail Economics empowers senior retail professionals to make informed decisions and gain a competitive edge in the evolving market.

About YOOBIC

YOOBIC is the frontline engagement platform built for retailers who want more from their operations. More alignment. More agility. More impact.

We replace clunky processes with one intuitive mobile-first app that keeps store teams, field leaders, and HQ connected and performing at their best — every shift, every store.

350+ companies around the world, including Boots, Rituals, Home Bargains, Lacoste, and Pret a Manger, use YOOBIC to turn retail execution into a competitive edge.

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