UK wholesale sales growth drops to 1.1.% - how can wholesalers bounce back?

It’s no secret that UK wholesalers have hit tough times.

Sales growth dropped sharply to just 1.1% by the end of 2024, thanks to rising costs, relentless competition and ever-changing regulations. But tough times also mean opportunities, if you're ready to act.

Confidence lowest since 2009 financial crisis

ICAEW’s Business Confidence Monitor puts wholesale business confidence at -23.4. That’s the lowest it's been since the global financial meltdown back in 2009. Inflation, high costs and lower customer demand have wholesalers rethinking investments and pulling back on growth plans.

But here's the thing: cautious doesn’t have to mean stuck. Michael Izza, ICAEW Chief Executive, says a clear long-term economic strategy from the government could rebuild confidence and reignite growth.

Financial challenges have had a big impact on certain sectors and across the board investment is set to fall over the next year, but it is notable that sentiment could be starting to level off.

Competition intensifies as growth slows 

Wholesale sales growth stalled at just 1.1%, according to recent ONS figures. So competition isn't just tough - it’s brutal. Both established rivals and fresh challengers are squeezing prices, forcing wholesalers into difficult negotiations and razor-thin margins.

The smart move now? Stand out through exceptional service, reliable product availability and smarter insights. Leveraging analytics to sharpen your pricing strategy could be the difference between scraping by and getting ahead.

Cost increases are the new norm 

Rising wages, increased supplier prices and new tax pressures are creating a cost crunch. Passing these costs on to customers isn’t always possible, making internal efficiency your best friend.

Streamlining operations through automation, optimising warehouse layouts and stock control can help cushion the blow. It's about working smarter, not harder to protect your profits.

Supply chain and labour challenges persist 

Supply chain issues haven't fully disappeared, and labour shortages, particularly in logistics, keep wholesalers on edge. Rising wages and skill gaps only add to the pressure.

But here's where proactive management shines. Improving supplier relationships, sharpening your demand forecasting and focusing on workforce retention could give you the agility needed to handle ongoing disruption.

Sustainability moves centre stage 

With new regulations around packaging and waste management, sustainability isn’t just nice-to-have - it’s necessary. Customers expect responsible practices, adding pressure to wholesale operations.

Turning sustainability into a competitive advantage by reducing waste, improving packaging efficiency, and adopting energy-saving measures can help you stay ahead of compliance while enhancing your reputation.

Time for strategic choices 

The market is tough - but far from hopeless. Wholesalers ready to focus on efficiency, customer-centric service, and digital solutions have every chance to turn the current challenges into tomorrow’s opportunities.

At Orderwise, we understand the market because we're part of it. Our warehouse management and stock solutions streamline your operations, boost efficiency and enable sustainable growth.

Ready to move forward? Discover how Orderwise can support your wholesale business today.