Retail Think Tank outlines key growth opportunities for 2024
Posted on in Business News , Cycles News
With the UK economy set to tread water in 2024, the KPMG/RetailNext Retail Think Tank (RTT), an independent board of retail experts, expects this will impact growth within the retail sector.
The RTT’s latest quarterly whitepaper – Retail outlook for 2024: What are the opportunities for retailers in a year of stagnation? – sets out its 2024 retail outlook, and includes key growth predictions, including re-invigorated retail formats and innovation trends, as well as its forecast for category winners and losers and predictions for the year ahead.
With monetary and fiscal policy remaining a dead weight on the UK economy in 2024, the RTT report highlights several challenges that will impact retailers into 2024. These include rising cost pressures on their businesses, including National Living Wage and Business Rate rises; weakened consumer demand due to the ongoing squeeze on households through higher interest rate mortgage refixing for homeowners or rising rent costs for renters, wage growth rising against static tax brackets, and household debt servicing costs.
As reported by The Retail Bulletin, despite these challenges, the RTT predicts several growth opportunities in 2024, including: exploring growth models, such as retail media, or adopting platform business models following the success of Next and M&S and reassessing asset classes, such as retail park settings; investment in tech, including Gen AI, as well as innovating across commercial functions and the supply chain; tapping into new growth cohorts of consumers and moving away from a GenZ focus to acquire and retain older, more affluent consumers.
When it came to its property outlook, the RTT expects retail parks to become the standout retail setting in terms of growth, predicted to improve relative to other assets classes, such as High Street and Shopping Centres.
Outside of retail park success, bricks-and-mortar will see a renaissance in 2024, the RTT predicts, driven in part by consumer demand as well as revenue driving opportunities.
Retailers should also ensure that economic stagnation doesn’t stifle innovation, according to RTT Co-Chair and KPMG’s Head of Retail, Paul Martin: “Even if the economic outlook remains muted, one thing history teaches us is that following a downturn we often experience an upturn, and retailers should be doing everything now to prepare for this.”