In the lead up to Liberation Day, and in its aftermath, the impact of new US tariffs has been front of mind for consumers and commentators alike.
Barclays Business Prosperity research (a survey of 1,000 UK micro, small, medium and large businesses) conducted in May, found that 79% of UK businesses are concerned about the impact of tariffs. However, they’ve been quick to respond and nearly half (48%) said they were already adjusting their US operations or supply chains.
But those concerns are not limited to businesses. Barclays’ Consumer Spend Report shows that more than seven in 10 (72%) UK adults are concerned about the impact of global import tariffs on their household finances. Much like business leaders, consumers are already adjusting. Over the last three months, they have expressed a desire to buy more British-made products. Meanwhile the recent announcement of the UK-EU trade deal has scored a positive reaction.
The EU trade deal has consumers feeling optimistic
Consumers have reacted positively to last month’s announcement of a new trade deal agreed between the UK and the EU.
The deal includes a new Sanitary and Phytosanitary (SPS) agreement designed to make it easier to import and export food and drink, which removes a number of routine checks on animal and plant products.
While a new SPS agreement is unlikely to be a particularly popular topic of conversation among consumers, the expectation is that the deal will deliver; over four in 10 (42%) believe it will benefit the UK economy, 45% expect to see an improvement in product availability and 41% expect product quality to improve.
Buying British: a trend that’s holding strong
In research conducted in April, Barclays discovered that 68% of UK consumers said they were looking to support UK businesses by buying more home-grown products. One in eight (12%) also said that they were willing to pay a premium for British or local products and brands, with this this group happy to pay 22% more on average.
In terms of what products consumers were looking to buy British, fruit and vegetables topped the list with 46%, followed by dairy (39%), meat (39%), seafood (29%), clothing and accessories (27%) and alcoholic drinks (20%). As well as that, 59% said that they plan to buy more local and/or seasonal British food.
Will the newly signed UK-EU trade deal benefit the UK economy?
Thinking positively
42% believe the newly signed EU trade deal will benefit the UK economy.
A wider range
45% expect to see an improvement in product availability.
Standards improving
41% expect product quality to improve.
Why they want to buy British
In research conducted in May, nearly half of UK consumers (48%) said that they will continue to prioritise British-made products such as food and drink, even if cheaper EU alternatives become available. To add to this, almost three in five (57%) shoppers say they think British-made products are of higher quality, explaining this preference for local produce.
Speaking about this, Karen Johnson, Head of Retail at Barclays, said: "The conversations we’re having with our retail clients show a determination to try to navigate these stormy waters as best they can."
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