Data: Just one in four retailers prepared as cyberattack threats mount

Only a quarter of UK retailers feel “highly prepared” to respond to major cyberattacks, despite a growing wave of threats facing the sector, according to new research by Retail Economics and Barclays UK Corporate Banking.

The study, based on interviews with 117 senior retail executives, found that 58% of leaders now rank cybersecurity among their top three concerns for the year ahead – ahead of both financial and operational risks.

Yet 11% admitted they remain unprepared to deal with attacks, leaving digital infrastructure and customer infomation vulnerable.

Retailers have stepped up efforts in response to recent high-profile breaches, including those affecting M&S, Co-op and Harrods, with nearly two-thirds increasing their focus on cyber resilience over the past year. This includes investment in system upgrades, supply chain security and board-level response planning

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Retail Economics chief executive Richard Lim says: “Cyber threats are no longer just an IT issue. They cut to the heart of customer trust, brand reputation and operational continuity. It’s concerning that so many retailers still lack the confidence and capability to respond effectively. Resilience today isn’t just about protection. It’s about being ready to act, recover quickly and adapt at speed.”

Alongside cyber threats, the report flags mounting financial pressure across the sector. Retailers face an estimated £6.5bn rise in operating costs in 2025, driven by hikes to the National Living Wage, national insurance, business rates and utilities.

Profit margins across the sector have already been squeezed – halving from 10.4% in 2014 to 5.7% in 2024 – and despite a decade of inflation, pre-tax profits have fallen by more than £7.3bn.

Barclays UK Corporate Banking head of retail and wholesale Karen Johnson said: “As operational and financial risks continue to escalate, it’s clear that embracing technological advancements and enhancing cybersecurity measures will be key to building resilience for UK retailers.”

The report warns that the gap between resilient retailers and those falling behind is widening. While 28% say they are ahead of the curve on risk management, the number of retailers who feel they are lagging has jumped from 21% to 25%.

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