Now that the December rush has passed, the month that reliably accounts for around 12% of annual retail spend, many retailers are finally catching their breath.
With all hands on the shop floor during the festive season, there’s often little room left for planning the year ahead.
But even amid the chaos, there’s one thing that came through loud and clear when speaking with retailers over recent weeks: against a backdrop of rising costs, squeezed margins and wavering consumer confidence, retailers are starting to rethink their business banking partners, writes Gareth Anderson, Head of Business Management, Allica Bank.
Many retailers are left feeling frustrated with traditional banks, which often fail to understand the unique challenges businesses in the sector face every day. The business leaders I speak to say they’re ready to invest – whether that’s expanding, upgrading digital platforms or improving the in-store experience – especially now when innovation has become essential to staying competitive and preventing British businesses from being left behind.
Yet they’re often let down, as high-street banks simply don’t offer the same level of support they once did. However, what many don’t realise is that there are other options out there, and their relationship with their bank can be different, and much better.
Stocking up on funding
These frustrations point to a much bigger problem. Last time I wrote for Wholesale Manager, I highlighted research from my own team at Allica Bank that found lending to the retail sector is down nearly a quarter on where it was three decades ago. And the reason is simple: many high-street banks have stepped back from supporting established businesses and instead shifted their focus toward bigger corporate retailers, leaving ambitious, innovative businesses struggling to find the support they need to grow.
There are real businesses behind these numbers, and when they’re given the opportunity to grow and invest, they do incredible things. One retail business I recently worked with, Cetuem, used a six-figure boost to expand their UK manufacturing, helping them build a distinct and uniquely British luxury brand while upgrading their facilities to meet rising demand. Another, a local entrepreneur in the South West, was able to take over well-known sports retailer, Dirtbikexpress, after years of supplying it. With funding in place, they’ve already launched a new website, brought in major brands and begun strengthening operations to support long-term growth.
Despite this innovation and despite having had long relationships with high-street banks, it remains the case that many businesses like these struggle to access the finance needed to move exciting opportunities like these forward.
It doesn’t need to be this way however. Banking is changing fast. Challenger banks like Allica have stepped in to fill the gap, becoming a major source of support for established businesses and now accounting for the majority of their lending.
The message here is impossible to ignore: if retail businesses want to grow, hire talent and expand in the year to come, they need to look beyond the high-street when it comes to banking, where real, specialised support is waiting.
Banking that fits
Better business banking isn’t something you pull off the shelf, it’s different for every single business. This means having a dedicated relationship manager who picks up the phone, understands your industry and takes the time to get to know your operation so they can provide support that really fits.
We’ve seen firsthand how this approach makes a real difference. As part of our focus in plugging the lending gap, my team at Allica Bank has unlocked a total £2.2 billion worth of growth across the UK, supporting thousands of jobs and businesses. And our analysis with Oxford Economics suggests just that – for every £1 million of our lending to the UK’s underserved businesses, it generates £2.4 million in GDP, 35 jobs and £600,000 in tax revenue.
This support reaches far beyond the businesses themselves – it strengthens the jobs they create, the public services they help fund, and the customers who count on them all year round.
The end of the year is certainly a busy and brilliant time for retail businesses across the UK, but as we now settle into January, it’s the perfect time to look ahead – and making sure you have the right banking for 2026 could make all the difference.
Comments are closed.