Convenience retailers made record investments of almost £300m in their businesses over the past three months, with the total amount invested in 2016 reaching £838m, research from the Association of Convenience Stores (ACS) reveals.

According to the ACS, the record level of investment in the fourth quarter comes despite rising costs for retailers in many areas of their business, including further increases in the National Living Wage and hikes in business rates for thousands of stores as a result of the 2017 revaluation.

ACS chief executive James Lowman said: “Retailers are making significant investments in their business to remain competitive, make their stores more energy efficient, and to try to secure their long-term futures. With the uncertainty of the rate of inflation, rising food prices and further increases in employment costs on the horizon, store owners are using their own reserves to fund improvements while attempting to make savings in other areas of the business.

“With the National Living Wage set to increase to £7.50 an hour in April, and further rises planned, we expect retailers to look to invest in measures that will make their businesses more efficient and productive. That will mean reducing staff hours, introducing automation where possible, and working more hours themselves.”

The research shows that 72% of independent retailers are funding investments from their own reserves, with just 6% turning to bank funding.

Also in the survey, 22% of independent retailers reported that the number of staff hours in their business had decreased over the past three months compared with the same period last year.