Independent covnenience stores owners are optimistic about the coming year, despite encroaching difficulties.
The latest update from the Association of Convenience Stores‘ Investment Tracker said that 47% of independent convenience retailers expect their sales to rise this year, with only 15% predicting a decrease.
In what was the third consecutive quarter for growth in the sector, around 21% of convenience retailers saw an increase in sales, compared to the same quarter last year. At the same time, 34% said their sales had fallen, and nearly one in four said they had reduced staff hours over the past year.
“The recovering sales performance and improving optimism of reatilers are encouraging signs in what remains a challenging retail environment,” said Chief Executive at ACS James Lowman.
“However, store owners are still faced with the ongoing challenge of food price deflation, intense price competition and increased regulatory costs, all of which will have a detrimental impact on the profitability of their businesses.
“We warned that retailers would cut staff hours and delay investment plans to deal with the increased employment costs due to the introduction of the National Living Wage, and these figures suggest that this is already happening. Convenience stores are facing multiple wage hikes over the next year in addition to the costs associtated with auto enrolment pensions, which will likely lead to store owners having to cut back even further.”