Introduction: Amazon is set to overtake supermarket giant Tesco to become the UKs biggest retailer in the next four years. Amazons total sales are expected to exceed 77bn by 2025, surpassing the 76.1bn forecast by Tesco, currently the UKs lIntroduction: Amazon is set to overtake supermarket giant Tesco to become the UK's biggest retailer in the next four years.
Amazon's total sales are expected to exceed £77bn by 2025, surpassing the £76.1bn forecast by Tesco, currently the UK's largest retailer, according to new research from Edge Retail Insight.
This shows how fast the online giant is growing, with total retail sales set to rise from £36.3bn in 2020 to £64bn.
In the five years to 2025, Amazon's compound annual growth rate (CAGR) is expected to be 16.3%, driven by rapid growth in grocery sales, compared with 3.5% for Tesco.
Amazon currently accounts for a relatively small share of UK grocery sales, despite growing 17.6% last year, but is expected to overtake Shell, McCols, BP and Wilko to become the country's 15th largest food retailer by 2025.
The data report also predicts that by 2025, a third of all retail chains in the UK will take place online, up from 26 per cent in 2020, helping e-commerce sales significantly outperform physical retail. E-commerce is expected to account for more than 57.4 % of new sales within five years, when the UK retail market is expected to grow by £123.6bn to £500bn.
Deren Baker, chief executive of Ascential, said: "Our data show that ecommerce is set to grow in the UK over the next few years, driven by digital marketplace giants such as Amazon and omnishape market giants such as Tesco."
"Over the past year, Amazon has expanded its online retail presence in the UK and expanded into the high street, opening three Amazon Fresh stores and a high-tech hair salon in London, where it can experiment with technology and product innovation to increase its brand presence in the fast-growing beauty industry.
"This is the next generation of retail -- Retail 5.0 -- the mass mastery of personalization. Consumer (CPG) brands must focus their investments on gaining market share through the online platforms where they are most relevant."
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