Association of Convenience Stores reports declining retail investment

The Association of Convenience Stores (ACS) 2026 Local Shop Report indicates that rising taxes and inflation are hindering investment within the convenience retail sector. Specifically, the report cites increased Employer National Insurance contributions and the removal of business rate reliefs as primary factors causing investment to stagnate. While retail investment reached record levels of over £1bn in 2024, it has since declined to approximately £900m annually for 2025 and 2026.

Despite these financial pressures, the sector's total sales are forecast to reach £49.1bn in 2026, representing a 0.6% increase from the previous year. To manage an average inflation rate of 2.9% over the last 12 months, retailers are increasingly adopting labor-saving technologies. Currently, 20% of UK convenience stores utilize self-service tills, and 14% use electronic shelf edge labels.

Additionally, the report highlights a shift toward home delivery services, with 47% of retailers offering the option, often through partnerships with platforms like Deliveroo or Uber Eats. The ACS also noted the social role of these businesses, with 78% of retailers reporting active involvement in community initiatives such as charity collections and local sponsorships.