Profit Warnings focus on sectors Q3 2021: FTSE Retailers

But the rising cost of living – alongside tax and benefits changes – could also hit consumers’ ability and willingness to spend. Meanwhile, the cost and availability of stock have become critical issues. Every food and non-food retail warning this summer cited supply chain disruption.

Strong demand should allow most retailers to outrun these tailwinds. UK consumers will always prioritise Christmas – even more so, after last year’s lockdown festivities. But it’s vital that retailers quickly understand and adapt to the forces reshaping their sector.

There are retailers that would have failed or required major restructuring in the last 18 months without the impact of COVID-19. Government support is unwinding, and this period of exceptionally strong catch-up demand is no more normal than the fall in demand during the pandemic.

To be successful, retailers will need clear strategic direction paired with strong operational and financial agility to meet short-term cost and supply pressures. Over the next months, the challenge lies with leadership to maintain clarity and focus to navigate this profound transformation.

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