More than seven in ten (71%) of small UK retailers are unprepared for the US trade shocks, while three-quarters (76%) of UK exporters are now actively diversifying beyond the US as a result of the new tariffs.
The research, from ESW and Retail Economics, shows that while larger UK retailers are radically re-drawing their global growth playbooks, small retailers admit they have no formal plan for sudden trade-policy shocks.
The report, “Rethinking Reach: How UK Retailers Are Turning Trade Pressure into Global Advantage,” highlights the factors driving the urgency of the need for change. The US’s new baseline 10% tariff in 2025 is set to increase average duties on UK non-food exports from 2.3% to 17.2%, the report says.
US viability threat
This is threatening the viability of the US for many, with more than half of UK exporters saying they would find trade to the US commercially unviable if tariffs exceed 22%.
“UK retailers are undergoing a seismic shift in their export strategies,” said Jon Sheard, VP of Northern Europe at ESW. “Retailers can no longer be overly reliant on a single trade corridor and are pivoting to new regions, including the Middle East and Asia-Pacific, where we are seeing exponential growth.”
According to the report, exports to the Middle East and North Africa surged 34% between 2021 and 2024, with the UAE now the fastest-growing UK export market outside the EU. Other growth regions include Non-EU Western Europe (+15%) and Asia-Pacific (+6%).
Reshaping retail
“Tariff volatility is reshaping the global retail landscape,” said Richard Lim, CEO of Retail Economics. “Retailers can no longer rely solely on traditional export markets like the US. Instead, they’re evaluating new trade routes and pivoting toward high-growth regions to diversify risk and capture new demand. Now is the time for exporters to plan and act. Future success will depend on the ability to adapt, localise, and seize emerging trade opportunities.”
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