03-07-2025
UK services surge offers digital momentum for fashion sector
The UK private services sector expanded at its strongest pace in 10 months during June, with the S&P Global UK Services PMI rising to 52.8 from 50.9 in May, driven by an uptick in domestic consumer and business spending, reported the Financial Times. Cost inflation simultaneously cooled, easing pricing pressures, a combination that could breathe fresh energy into fashion retailers relying on digital infrastructure .
For fashion and retail executives, this rebound is significant. Services growth encompasses key digital enablers, e-commerce platforms, supply-chain logistics, marketing agencies, and tech providers, crucial to operational efficiency. With online sales now contributing to approximately 45 percent of global fashion retail and 70 percent of brands planning increased digital investment, the PMI data reinforces the strategic importance of bolstering digital ecosystems.
This momentum arrives as markets anticipate a Bank of England rate cut in August, trading at an over 80 percent probability according to the FT, which could unlock investment capital for digital transformation. Indeed, apparel brands have already increased spending on e-commerce tech (43 percent year-over-year), AI (60 percent), AR-enabled virtual try-ons (68 percent), and 3D product visualization (54 percent), according to data from Gitnux
However, employment in the services sector declined for the ninth month, hinting that productivity gains are being driven by technological upgrades rather than labour expansion. For fashion firms, adapting to this technological turn means prioritising partnerships with digital service providers, from logistics platforms offering on-demand warehousing and cross-border payments to AI-driven customer-service cohorts.
Implications for the sector: E-commerce and logistics
With cross-border marketplaces flourishing and automation gaining traction, retailers can leverage lowered costs to refine fulfilment and returns. Consumer engagement
Algorithms and virtual tools like AR try-ons and styling assistants are no longer niche—they're expected. Nearly 70 percent of brands now view AI personalization as crucial . Operational resilience
Service-sector digitalisation offers a buffer against economic volatility, allowing fashion brands to scale selectively without overextending headcount.
As UK services rebound and digital spending accelerates, fashion executives should view infrastructure investment not as a cost, but as core capital. The lines between fashion brand and digital platform are blurring, and those that invest wisely will navigate swiftly through this evolving landscape.
