UK independent retailers recorded stronger sales performance over the recent Christmas trading period, even as larger high-street chains saw weaker demand, according to official data and industry expert analysis.
Office for National Statistics figures show mixed results across the broader UK retail sector, with growth in some smaller outlets contrasting with a decline among bigger players.
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The split in performance highlights ongoing challenges for the wider retail market as consumer confidence remains cautious.
Trends in UK retail sales over Christmas
Retail sales volumes in Great Britain experienced moderate shifts through the final quarter of 2025, with the Office for National Statistics reporting a small rise in overall sales during December following earlier declines.
December’s monthly increase was estimated at around 0.4% after weaker readings in October and November, although volumes over the full three-month period to December fell by about 0.3%.
Industry data suggest that this national picture masks divergent trends across different types of retailers. “ONS retail sales figures show a fragmented market over Christmas, with larger retailers seeing sales drop 1.6% while smaller independents grew 6.4%,” said Harvir Dhillon, economist at the British Retail Consortium.
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By GlobalDataThe figures point to a scenario where independent shops and smaller outlets were able to attract higher sales volumes even as big retail chains struggled.
These contrasting patterns partly reflect consumer behaviour during the holiday season. While some shoppers gravitated towards unique or local stores, larger retailers faced headwinds from subdued discretionary spending and weaker demand for traditional Christmas gift categories such as electricals and beauty.
Economic context and consumer sentiment
Retail sector performance has been shaped by broader economic factors, including sustained cost-of-living pressures and shifts in consumer confidence.
Despite the modest December rebound in overall sales, annual retail volumes for 2025 remained only slightly up on the year before, and still below levels seen prior to the Covid-19 pandemic.
Economists highlight that many households continue to prioritise essential spending over discretionary purchases.
PwC noted that while total retail sales volumes rose compared with the previous year, this was “due to higher sales of essentials rather than broad-based strength across all retail categories.”
With inflationary pressures still affecting household budgets, discretionary shopping remained constrained, putting additional pressure on larger store formats that rely on volume traffic.
Commentary from industry experts
Industry commentators described the results as indicative of a retail sector in flux. “Sales patterns over the Golden Quarter underline how differently retailers have fared in a tough economic backdrop,” one analyst said, pointing to the stronger performance of independents as a sign of shifting consumer priorities.
Harvir Dhillon of the British Retail Consortium warned that if cost pressures persist—particularly rising business rates and labour costs—“ordinary workers” could feel the impact as smaller retailers expand and larger chains retrench.
As UK retailers enter 2026, the bifurcation in performance between independents and big chains is likely to remain a focus for those monitoring retail trends, sales growth patterns and the broader outlook for consumer spending.
