21-06-2025
Cyber security, operational, financial risks priority for UK retailers
Cyber and data security is cited as the biggest risk across the UK retail sector at present, followed by operational and financial risks, according to a study by Barclays Corporate Banking and Retail Economics.
'Cyberattacks have been top of the agenda for retail boardrooms across the UK in recent weeks, and our research shows that just one in four retailers feel "highly prepared" to detect, respond to, and recover from a major cyber incident,' Richard Lim, chief executive of Retail Economics, said in a post on microblogging platform X.
'Against the backdrop of tariff uncertainty, geopolitical instability and pressure on profitability, this year's report also shows that risks have become more widespread,' he wrote.
Cyber and data security is cited as the biggest risk across the UK retail sector, followed by operational and financial risks, a study by Barclays Corporate Banking and Retail Economics found. Fifty-eight per cent of respondents placed cyber resilience among their top three concerns, while 11 per cent admitted they are unprepared for cyberattacks. Cost control has become a sharper strategic focus.
Fifty-eight per cent of respondents placed cyber resilience among their top three concerns. Resilience to cyber threats requires proactive investment, from infrastructure upgrades and supply chain security to regular stress-testing and board-level ownership of response protocols, he noted.
Eleven per cent of surveyed retailers admitted they remain unprepared for cyberattacks, exposing serious vulnerabilities at a time when digital infrastructure is critical to operations, trust and continuity.
Sixty-four per cent of retailers have increased their focus on cybersecurity over the past 12 months—from upgrading systems and stress-testing response plans to embedding security across supply chains, Lim wrote.
'The number of principal risks disclosed by the UK's top 30 listed retailers has risen to 278, with 40 new or escalating risks in the past year alone. Of these, cyber-related risks account for a high quarter (25 per cent) of this increase,' he mentioned.
Financial pressure remains a close top concern for 2025-26 as well, with 55 per cent of respondents placing financial strength among their top three concerns. Financial resilience has emerged as the most commonly selected first-choice priority (23 per cent) as retailers manage a fresh wave of cost increases.
UK retailers are set to face a £6.5-billion rise in operating costs in 2025, driven by increases to the National Living Wage, Employer National Insurance contributions, business rates, utilities and property costs.
Over the past decade, average pre-tax profit margins have almost halved—from 10.4 per cent in 2014 to just 5.7 per cent in 2024. Despite a decade of inflation, this translates into a fall of over £7.3 billion in pre-tax profits across the sector from £32.7 billion to £25.4 billion.
'It means cost control has become a sharper strategic focus—yet many retailers are balancing defensive measures with forward-looking investment in technology, data, and supply chain resilience,' Lim added.
Fifty-seven per cent of respondents placed operational agility among the top three concerns.
Trade tensions continue to test supply chains, while artificial intelligence and digital transformation present major opportunities, but only for businesses with the skills and agility to respond, according to the report.
Fibre2Fashion News Desk (DS)
