INSIGHT | Retailer survey analysis
The year of OPPORTUNITY?
here’s no getting away from talk of the cost-of-living crisis, rising interest rates and the general chatter about economic uncertainty at the moment. Even the most optimistic among you will no doubt be wondering what 2023 will bring for the sector and your businesses. But rather than rely on hearsay, we decided to
T We’re cautious
carry out a survey to paint an accurate picture of how independent retailers are currently faring and, more importantly, to gauge their optimism for the year ahead.
How confident are retailers feeling? What are their biggest fears heading into 2023? And most importantly, where do the opportunities lie? This really is a fascinating, representative snapshot of retailer confidence as we approach the New Year.
How would you rate your business confidence for the year out of 10? While the overall results showed quite a variation in confidence among our respondents, the average score was six, which shows
because of the cost-of-living crisis and a forlorn Government that doesn’t seem to be able to guide us through it
in 2023. Just 28% said they were confident they would see an improvement in their business in 2023.
26%
of retailers admitted they
are considering changing their main suppliers in 2023
that retailers, in general, actually have a rather robust outlook.
So, what factors or challenges were influencing their responses? An overwhelming number put their mid-level confidence down to the unpredictability of the market and their concern that, because of wavering consumer confidence, they would struggle to convert estimates to sales in 2023. Unsurprisingly, the scores were heavily influenced by region – with many of those operating in areas populated by consumers generally less affected by financial downturns giving higher scores than others. One bathroom retailer said: “In previous years, we would have said nine or 10, but because this year, going into 2023, has us most concerned about the economy, it has to be seven.” Another KBB retailer said: “We’re cautious because of growing uncertainty with the cost-of- living crisis and a forlorn Government that doesn’t seem to be able to guide us through it. It would be unrealistic not to be a little cautious.”
Compared with 2022, how do you think your business will perform, in 2023?
While the majority of respondents (39%) said that they expected their business to perform the same as it did in 2022, a significant number (32%) worryingly said they expected their business to decline
“I expect our business to perform the same in 2023 as it did in 2022,” said one KBB retailer. “Market confidence is faltering, but I feel our long history and pedigree will see us maintain a solid order book.”
One less confident kitchen retailer said that he expected his business to decline in 2023 because of “poor supply, fewer clients, stratospheric price increases from suppliers and non-existent
supplier customer service”.
When you consider that two-thirds of respon- dents have orders booked three months ahead or less, and just 9% saying that their order book extends six months ahead, it’s perhaps not surprising that a lot of retailers remain cautious about the future of their businesses at this stage.
What do you see as the biggest challenge facing you in 2023?
The most popular – or should that be unpopular – answer here was consumer spending. To put that into context, a whopping 64% of retailers said that they believe the predicted slow down on consumer spending will be the biggest challenge for their business in 2023.
This is about managing our own mind-set. Keeping focused and keeping our energy high, even when times are tough
36
Product shortages, rising costs and supplier price increases were also highlighted as concerns and factors that could signif icantly impact retailers next year. However, despite it being highlighted as a constant worry for retailers throughout
of retailers believe consumer
64%
spending will be the biggest
challenge in 2023
2022, with just a small percentage of respondents citing ‘lack of fitters’ as a concern for 2023 is this a sign that things are improving?
· December 2022
Y
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