Independent Shops: Costs, Stock and Benchmarks

The ONS figures for retail cover everything from supermarkets to corner shops. In 2024 there were 213,265 retail businesses registered for VAT or PAYE, with sales of £513.7bn. The large chains dominate the totals, so treat the figures as the shape of retail costs rather than a target for a small shop.

The figures

Source: ONS Annual Business Survey, 2024 results (published 26 May 2026). It covers businesses registered for VAT or PAYE, so the smallest sole traders are not included. Averages are pulled up by the largest firms. For sole traders and partnerships, the owners’ own pay is not in staff costs: it comes out of what is left.

Retail is a buy-and-resell business. About £79 of every £100 of sales goes on stock and other bought-in goods and services, leaving a thin share once staff are paid.

How it has changed since 2019

All retail (excluding motor trade): turnover rose 20% between 2019 and 2024, against a 24% rise in consumer prices, so it fell behind inflation. The number of businesses fell 2%. Staff costs went from 12.3% to 12.9% of turnover, and what was left after staff and bought-in costs went from 9.0% to 8.0%.

What this means for an independent shop

• Margin by product line. A thin overall margin means some lines are doing much better than others. Know which ones pay for the shop.
• Slow stock is the hidden cost. Stock held averaged about 40 days of purchases across retail. Lines that sit much longer than that tie up cash and space, and often end up discounted.
• Reorder little and often. Smaller, more frequent orders keep stock lower, as long as delivery costs do not wipe out the saving.
• Staff to footfall. Match staff hours to the busiest trading hours and days.

Compare your shop

Guides that fit this trade

• Stock turnover and EOQ: how much to order and when.
• Margin vs markup: pricing to the margin you need.
• Cash conversion cycle: the cash tied up in stock.