The Scottish Grocers’ Federation (SGF) has today (1 October) revealed its latest annual figures on the Scottish convenience sector.
The report highlights a reduction in local lifeline services and a staggering 10% drop in staff over the year, amidst an increasing cost of doing business which is hammering the sector.
Published with the support of the Association of Convenience Stores (ACS), the SGF Scottish Local Shop Report 2025 shows that the number of convenience stores has remained consistent at 5,228 (up eight on 2024). However, the number of people employed in the sector has dropped by 6,000 to 49,000.
Meanwhile, it notes employer National Insurance contributions have shot up to £396m - an increase of £175m on the previous year (UK wide). This is in addition to year-on-year hikes to the National Living Wage increasing by 33% since 2019 (from £8.21 to £12.21 per hour).
The report reveals several other critical services offered in local stores have also come under pressure, including the Post Office (down from 25% to 20%), free cash machines (down from 46% to 40%) and prescription collection (down from 4% to 2%).
The report goes on to show how cost pressures such as retail crime, tighter regulations across a range of product areas and a real terms decline in business rates reliefs have also resulted in retailers investing less back into their stores - down from £94m to £89m in 2025. Nonetheless, many stores are also meeting new demands for services such as home delivery/click and collect (up 12% this year to 47%).
Ahead of his welcome address at the SGF Annual Conference in Glasgow today, SGF president and independent retailer at Watson’s Grocers in Moniaive, Graham Watson (above), said: “Local stores provide many essential services close to where people live, and they’re part of the fabric of their community.
“In the years since Covid, we’ve seen the sector make great strides, offering more jobs, delivering new services and providing an important economic multiplier for local areas.
“Pressure from external factors and government is putting many businesses under strain, and we’re seeing worrying job losses and critical services disappearing.”
“Pressure from both external factors and from government, however, is putting many businesses under strain, and we’re now seeing worrying job losses and critical services disappearing. That’s why we need a more wholistic approach from government, looking at the broader impacts of policy on key services and sectors.
“Everyone agrees providing flexible local employment and services such as Post Office and access to cash, is part of the ‘full basket’ that our sector can offer. Albeit many of those services have limited viability in their own right.
“That’s not possible when retailers can’t afford to pay staff or reinvest in their business because they are swamped with higher employment costs, a rising cost of doing business, retail crime, and ever tighter regulation.”
The report also shows a reduced spend in stores and fewer items being bought per customer, which may be linked to struggling household budgets and the cost of living. With average shopper spend dropping from £8.04 to £7.81 and the forecast yearly sales dropping by £0.6bn to £48.8bn in 2025 (UK wide).
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