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Unlocking growth in the golden quarter

Retail Outlook 2026
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We look at the latest retail data and trends, unpacking what they mean for the all-important golden quarter.

Retail, Consumer and Leisure Briefing 2026

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Black Friday 2025: spending up despite softer interest

We expect UK consumers to spend £6.4 billion this Black Friday - up 1.5% on last year - even though fewer people plan to take part. With eight in ten purchases expected to be online, Black Friday remains a key moment for retailers to drive sales and show resilience.

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A sprint to the finish?

Sticky inflation, ongoing cost headwinds and stubborn interest rates. At first glance the picture appears similar to last year. Our latest consumer sentiment survey finds UK households remain cautious. Even so, broader data shows household savings are higher than before the pandemic and real incomes have risen for two years in a row. The money is there, but the confidence to spend is not.

“Every year shoppers say they’ll cut back, yet come January, spending often tells a different story. So, there’s room for some optimism.”

Jacqueline Windsor
UK Head of Retail and Strategy& Partner, PwC United Kingdom

Our recent consumer surveys indicate spending across the festive period will be up slightly on last year, and the rise of ‘joyful gifting’ means even the most cautious consumers are looking for moments to treat themselves and loved ones.

Despite this, retailers have faced the task of rebuilding consumer confidence against an uncertain economic backdrop. With the Chancellor’s Autumn Budget now public, there’s a chance consumers will have greater certainty over their own household budgets, which could see a later-than-usual uplift in spending across the all-important golden quarter.

The Budget does, however, bring a mixed set of implications for retailers: the reform of business rates offers relief for some, while the new surtax on larger premises and the drawn-out removal of the customs duties exceptions on low-value e-commerce parcels adds pressure. Rising wage costs, particularly for under-21s, could shape hiring decisions and adds another layer of complexity.

Against this context, growth is likely to remain modest, so retailers will need to focus on gaining share rather than relying on market growth. Soft trading comparatives also present opportunities to outperform, particularly as consumers still want to make the season feel special.

“My message to retailers is to hold your nerve on value. Shoppers want value-for-money, not just lower prices. Lean into occasions and small treats, such as health and beauty, and other treat-led categories.”

 Lisa Hooker
Global FDD Leader and Retail, Consumer and Leisure Specialist, PwC United Kingdom

Retailers who deliver a seamless experience can strengthen loyalty and become shoppers’ preferred choice, particularly if spending comes later this year. That means getting integration across multiple touchpoints right, whether it’s click-and-collect, in-store, online or returns. But even with these capabilities in place, retailers are not immune to the mounting pressures shaping the sector.

Priorities for retailers

Growth in this sector will be hard-won, but there’s potential for retailers ready to act. Those who can adapt quickly, protect margins, and deliver value-led experiences will be best placed to outperform.

Retailers are navigating competing investment demands: reinforcing value credentials in the short-term and transforming their business models in the medium-term. They are relooking at their cost base to be able to fund some of those investments, reallocating back-office costs to customer-facing activities.

Labour costs remain elevated, with ongoing increases to National Insurance Contributions, the National Living Wage, and potential implications from the Employment Rights Bill. These changes are squeezing margins and creating a clear need to rethink workforce strategies.

Bricks-and-mortar remains central to brand experience and customer acquisition, but fluctuating footfall is putting pressure on store economics. Retailers must reimagine the role of physical locations - optimising number of stores, introducing experiential formats, and integrating digital touchpoints to attract and convert customers.

Delivering a seamless experience across channels carries growing expense. Investments in order management systems, warehouse management systems, and last-mile logistics are escalating as retailers strive to meet consumer expectations for speed and flexibility. Keeping these costs in check while protecting margins is essential for maintaining a healthy fulfilment model.

The past year has seen several high-profile breaches across the retail sector, highlighting the urgency of robust cyber resilience. From safeguarding payment systems to protecting customer data, retailers must embed security into every layer of their operations. Those who act decisively will not only mitigate risk but also strengthen consumer trust.

Retail, Consumer and Leisure Briefing 2026

Hear from sector leaders as they unpack the latest data to help you navigate what’s next.

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Lisa Hooker

Lisa Hooker

Global FDD Leader and Retail, Consumer and Leisure Specialist, PwC United Kingdom

Tel: +44 (0)7802 882562

Email
Kien Tan

Kien Tan

Senior Retail Adviser, PwC United Kingdom

Tel: +44 (0)7880 552726

Email
Jacqueline Windsor

Jacqueline Windsor

UK Head of Retail and Strategy& Partner, PwC United Kingdom

Tel: +44 (0)7801 074739

Email
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