Ultra-low-cost international shopping platforms are now a significant force in UK retail, attracting around £4.7bn in annual consumer spending and accounting for 5% of non-food online sales, according to new research by Barclays and Retail Economics.
The findings highlight growing competition for established retailers as shoppers increasingly seek lower prices and wider product ranges.
The latest Retail Resilience research found that 49% of UK consumers have bought products from ultra-low-cost international marketplaces during the past year.
The report suggests these platforms, many of them Chinese-owned, have moved beyond being niche players to become a mainstream part of the UK e-commerce market, reshaping customer expectations on price, product choice and delivery.
Low-cost marketplaces reshape UK retail
The rapid expansion of international online marketplaces is increasing competition across price-sensitive categories including fashion, beauty, homewares and general merchandise.
For domestic retailers, the challenge extends beyond losing sales. Consumers are becoming accustomed to frequent discounts, extensive product catalogues and low prices, making it more difficult for established businesses to protect profit margins while maintaining quality, customer service and regulatory standards.
The report says these platforms now represent a “material force in UK retail”, reflecting a shift in the competitive landscape rather than a temporary market trend.
Industry analysts note that online shopping continues to gain importance across the sector, with retailers facing growing pressure to compete on value while investing in digital capabilities and customer experience.
Retailers look overseas for growth
With domestic demand under pressure, many UK retailers are increasingly exploring international markets to support future growth.
The research suggests that expanding into overseas markets is becoming a strategic response as businesses seek new revenue opportunities while facing rising operating costs and changing consumer behaviour at home.
The report also points to broader changes in retail resilience, highlighting the need for companies to diversify their business models and adapt to evolving market conditions. Retailers that strengthen their ability to manage disruption are expected to be better positioned for long-term performance.
Cyber security tops boardroom concerns
Alongside growing competition, cyber security has emerged as the leading business risk for UK retailers.
According to the research, 64% of retail leaders rank cyber and data security among their top three risks for the coming year, up from 58% a year earlier. Cyber security is also the most frequently selected number one risk, with 29% placing it ahead of financial, operational and strategic challenges.
The findings reflect the increasing importance of protecting customer data and business systems as retailers expand their digital operations and online sales channels. The report concludes that cyber resilience is now a core boardroom priority alongside commercial performance and growth planning.
“International low-cost shopping sites take £4.7bn from UK consumers” was originally created and published by Retail Insight Network, a GlobalData owned brand.