UK set for six years of e-commerce growth

The Long-Term	The Short-Term	The Strategy
UK e-commerce to see 3 further years of growth to 2029. CAGR expected to exceed 7%.	Opportunities from short-term trends in 2026 and obstacles: Climate Consumer Confidence	Agile, flexible e-commerce operations with reliable order fulfilment. Adapt to emerging trends and minimise costs.

UK e-commerce businesses are enjoying a period of huge potential. Having experienced three years of strong growth, revenues are predicted to continue to rise until the end of the decade. The US government’s International Trade Administration updated its UK e-commerce commercial guide[1] earlier this year, with some impressive figures for the country’s website owners:

UK e-commerce sales increased 30% in 2024-25
E-commerce reached 38.1% of UK retail sales in 2025
UK e-commerce market is the third-largest after China and US

But it is the forecast for the future that holds the most promise, with UK e-commerce revenues expected to continue a multi-year growth trend. This should see total UK online sales achieve a sixth consecutive year of growth in 2029, at an average annual compound rate of 7.01%.

If this is achieved, UK online retail sales will be worth nearly £142 billion per year by the end of the decade, over £2,000 per internet user.

The Value of UK International E-commerce

ONS figures published in June 2026 show that UK businesses sold £77.8 billion of goods and services to international customers in 2021, defined as “digitally ordered trade” or simply as “international ecommerce”.[2]

That equates to 11.4% of total trade for that year – roughly £1 in every £9 of trade. The same report estimates that UK cardholders spend £50.5 billion a year on “digitally ordered imports”, meaning e-commerce exports exceed imports by about 54%.

UK E-commerce vs Physical Retail

Within the UK economy, e-commerce sales volumes grew faster than face-to-face retail in July 2026, compared with the previous year – but over the same period, in-person retail grew slightly more in value.

Retail Type	Volume	Value
E-commerce	26%	39%
Bricks and Mortar	1.6%	2.2%

Growth in UK Retail Year-on-Year, July 2026. Source: Barclays[3]

Consumer confidence hit a 21-month high in July, with discretionary spending up by 1.6%. The majority of Brits (53%) are now confident in their ability to spend on non-essential items, while two thirds (69%) are comfortable that they can live within their means.[4] “Our survey showed that over half of UK consumers are already using AI to enhance their online shopping experience. The risk for retailers is that they fail to adapt and miss an opportunity to reach the consumers of tomorrow.”

The Impact of Climate on UK E-commerce

Barclays found that the prolonged hot weather in the summer of 2026 led to an uptick in certain retail categories:

Electronics (e.g. fans) +1.3%
Clothing +2.0%
Garden centres +4.0%

One in five people surveyed by Barclays said they had bought cool or light clothing in response to the hot weather. Interestingly, the survey found that shopping is the one activity British people are willing to do at higher temperatures than any other:

ideal	Shopping	Cooking	Work from Home	Sleeping
24.6%	25.1°C	24.7°C	23.7°C	22.0°C

Brits’ Maximum Summer Temperature per Activity. Source: Barclays[5]

For the five weeks from May 31st to July 4th 2026, the British Retail Consortium found that the hot weather drove more shoppers online.[6] During that time, online non-food sales grew by 5.1% year-on-year, while total retail sales were up 1.9%. This increased online’s share of UK retail to 39%.

Helen Dickinson, chief executive of the BRC, said: “While in-store sales were stifled by soaring temperatures, the proportion of sales online was the highest of 2026, bolstered by well-timed promotions.”[7]

Planning for a High-Growth Future

IMRG, the UK’s e-commerce association, says that the British weather “has a habit of reshaping consumer demand overnight”.[8] In a recent article published on the IMRG blog, content manager Ellie-Rose Davies noted a 153% year-on-year surge in sales of small appliances in the week of May 24th, with another spike of 137.7% in the week of June 21st.

“With multiple days hitting above 30°C and record heat recorded on 26th June, it is no wonder that consumers began to invest in appliances such as fans.”

– Ellie-Rose Davies, Content Manager at IMRG, August 2026[9]

She went on to argue that while retailers cannot control the weather (or the forecasts of it), they can remain vigilant for emerging consumer trends and agile in their response to new retail opportunities that may arise.

To do this, she listed several techniques that may allow ecommerce retailers to develop a competitive advantage from unpredictable conditions:

Prepare flexible marketing strategies
Build agility into operations
Maintain visibility of inventory
Deliver reliably during spikes in demand
Plan for a wave of returned products

All of these form part of e-commerce best practice whatever the weather, enabling operators to fulfil orders quickly, reliably and efficiently, leaving customers with the fewest reasons to request a return or a refund.

Maximising Growth by Minimising Costs

Sustained growth potential in the coming years means that e-commerce operators who are able to perform smoothly – with reliable and efficient order fulfilment – will be best placed to maximise profits while minimising costs.

With many consumers still taking a cautious approach to spending, another IMRG article from July 2026[10] suggested several steps to reduce fulfilment costs:

Help customers shop right first time
Use technology to improve buying decisions
Incentivise more profitable baskets
Analyse data to eliminate avoidable costs
Optimise fulfilment and delivery

“Returns, exchanges and customer service enquiries all create additional operational costs, meaning every incorrect purchase has an impact that extends well beyond the original order.

“For that reason, many retailers are shifting their attention towards the point of purchase.”

– Ellie-Rose Davies, Content Manager at IMRG, July 2026[11]

An efficient warehouse operation with good inventory management, fast and flexible despatch and delivery, plus a fair returns policy, all incentivise shoppers to spend more and reduce reasons for refund requests.

How MRM can help support your sales growth

Well placed to support e-commerce companies, MRM assist their clients to take advantage of emerging opportunities and sustain profitable growth.

In a period of active and ongoing market expansion, e-commerce operations face both obstacles and opportunities. MRM ‘s agile, information-driven warehouse operations, flexible sales promotions, and workflows minimising fulfilment cost, help companies profit from short-term opportunities. Unpredictable economic confidence and the climate cannot be anticipated, but with client focused ecommerce fulfilment services, scalable to thousands of orders per month, MRM e-commerce services are the backroom engine powering e-commerce business for both start-ups and multinationals.

MRM handle domestic and international despatch with competitive rates from leading couriers, optimising inventory control and warehouse management via our Newton software platform.

To find out how MRM can support your business growth, call us today on 01858 410510 or contact us to schedule a 15-minute fact-finding meeting, where we can understand your objectives and advise how to achieve these within your timescale at the lowest cost.