Covid 19 Impact on the UK Market

In the early stage of the pandemic stockpiling of staples was the most visible manifestation of the uncertainty people were experiencing – including a 60% year-on-year rise in the sale of toilet paper in the UK in the first week of that month. Many supply chains have now had the chance to recover from the unprecedented surge in demand for essential products. In more discretionary areas, such as fashion, the impact had been even more brutal. Not only were supply chains disrupted but to forecast the needs of the consumers had also become very difficult. While some estimates have suggested that the fashion industry lost close to £11.1 billion in 2020, economic uncertainty has also pushed consumers to re-evaluate other aspects of their finances. As per the Office for National Statistics, expenditure on housing and food make up almost 42% of total expense for households at the bottom ten per cent of the income distribution, compared with 26% in the richest decile.


The consumer behaviour changes were very evident globally but some countries have bounced back to their normal consumption state, like, India and China. In the UK, it could be seen that most of the consumers intend to continue shifting their spending to essentials while cutting back on more discretionary categories.



COVID-19 has had a significant impact on shopping habits of consumers in the UK. Compared to France and Germany, a higher percentage of UK consumers (55%) spent less on non-essential items as a result of restrictions. More UK shoppers (46%) reported buying items that they usually buy in-person, online instead. Other trends that were observed were delaying a purchase they intended to make (39%), buying from local businesses to support the local economy (41%), and shopping in-person at a store different from their usual shop (32%). Fortunately, growth opportunities still exist. During the pandemic, 26% of global consumers tried at least one new brand and nearly 95% say they are likely to buy from that brand again. But to reach new customers brands need to tighten up their boots by developing a messaging strategy that speaks to what they care about the most. As brands rethink their messaging, they put more focus on value over quality and availability.



A new report by global professional services firm Alvarez & Marsal (A&M), in partnership with Retail Economics, estimates that more than £4.2 billion of products will be on-shored to the U.K. by retailers in the next 12 months. This would serve as a significant boost to UK manufacturing, being equivalent to the country’s entire current clothing manufacturing output.


Several big companies reported a financial hit. Marks & Spencer scrapped next year's dividend and said its city centre food stores and clothing and homeware sections were badly hit by the lockdown. Travis Perkins, Britain's largest distributor of building materials, stated that its total revenue in the first three weeks of April had dipped by two thirds from the same period last year. The British Retail Consortium said on April 16 that spending by its members dropped by more than a quarter in the first two weeks of the lockdown.


The fear and anxiety among consumers brought on by the pandemic are now more visible in their financial caution, with the crisis having shoved the global economy into recession.


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