Watch: Predictions for the retail market in 2023

As the year draws to a close, many retailers are occupied with the busy festive period, and with businesses and consumers under immense pressures this year, some will be looking forward to the new year already.

With less than half of Brits feeling positive heading into 2023, we spoke to Georgie Brooks, Matt McCue, Rachel Belam, Matt Illingworth, Ronald Nyakairu, and Robert Wingrave at Completely Retail Marketplace to ask them their predictions for the next year.

Matt McCue, director at Savills, said that any changes in the New Year would “be an evolution, rather than a short, sharp shock”.

“When you look at the market at the moment, I think we started the year at a vacancy rate of 6.1%, we’re down to 5.5%, and Savills research are talking about a vacancy rate of 4.4% by the end of the year, which is an all time low”, he added.

Georgie Brooks, director at Curson Sowerby Partners, observed that the blending of uses in retail parks was becoming increasingly widespread, with more drive-throughs opening, as well as leisure units such as gyms joining retail parks and expects to see this continue.

When asked about the brands to look out for in 2023, Brooks said that a lot of European companies are not viewing the UK as an attractive place to explore, especially since its exit from the European Union. She added that because of a weaker pound, the UK may become a more attractive location for American brands in the future.

This has already been observed by Ronald Nyakairu, head of insights and analytics at Local Data Company, who stressed that an influx of foreign brands such as Tim Hortons, Wendys, and Popeyes is keeping the food and beverage market healthy. Nyakairu added that digitally native brands can expect to have a good year, if they look to the high street to engage with customers.

Rachel Belam of Unibail-Rodamco-Westfield, said that the leisure market is very active with lots of new players getting involved, while Matt Illingworth, director at Hynes Illingworth, believes that retailers who have invested in both their online as well as high street businesses could expect to have a strong year, while independent businesses can anticipate improvements, as it’s “more about customer service now”.

Speaking on next year’s challenges, Robert Wingrave, CEO of Time Retail Partners stressed that margin was going to be the biggest obstacle facing retailers:

“In terms of energy costs going up, wages going up, […] importing now with the currency, there’s going to be huge pressure on margin”.