Fewer than one in ten convenience retailers are planning to invest in their business in the future, according to new figures released by the Association of Convenience Stores (ACS).
When asked about their business plans in the quarterly Voice of Local Shops Survey, only 9% of independent retailers said they planned to invest in their stores over the coming year - the lowest level seen since the survey began in 2012 and a decline from 16% last May.
The ACS has also observed that in addition to holding off future investment plans, retailers have already shown a decline in the amount they have invested over the past three months. Overall investment levels in the convenience sector have fallen from £147m in February 2019 to £112m this quarter.
ACS chief executive James Lowman said: “Convenience stores are performing well in terms of sales this year so far, bucking the trend of the high street and wider retail sector which has seen some challenging sales figures in the last few months. However, this is not being backed up by plans to invest as retailers are holding back on spending.
“While there are many possible reasons for retailers not investing money in improving their stores, there are two factors that are significant. The latest hike in the National Living Wage and National Minimum Wage rates will certainly have led some retailers to delay investment plans, especially those operating with higher staff numbers and long opening hours.
"Secondly, the ongoing uncertainty over the UK’s exit from the European Union has to be playing a part. We have been clear to Government that a no-deal Brexit would have serious consequences for the convenience sector, but continued uncertainty and confusion is now manifesting in record low investment levels.”
For those who are choosing to invest, the most common areas of investment are refrigeration (40%), shelving (21%) and in-store lighting (13%), as retailers continue to look at making their stores more efficient.