UK retailers are facing sustained disruption from cyberattacks, supply-chain problems and weather-related events, but many are prioritising short-term cost pressures over longer-term resilience, according to new research from Marsh.

The insurer and risk adviser’s Retail Pulse 2026 report, based on a survey of 350 senior UK retail executives, found that 93% had experienced significant disruption during the past year, while 71% said disruption had become a permanent feature of doing business. Despite this, two in five retailers have redirected long-term investment towards immediate costs or risk priorities. Marsh found that 53% are accepting higher risk exposure to protect margins, while 47% are extending the use of ageing IT systems and 30% have reduced operational flexibility.

Cyber risk has become the leading concern among respondents, cited by 46% compared with 39% in 2024. However, only 5% of retail leaders said they felt protected from cyber incidents or exposure within their organisation.

The research also highlights questions around the effectiveness of cyber investment. Nearly two-thirds (64%) of retailers that experienced a major cyber disruption last year said they were nevertheless overinvesting in cyber resilience, suggesting that increased spending is not necessarily translating into greater protection.

Marsh also found a gap between investment and returns more broadly, with 65% of retailers saying they were spending excessive budgets while seeing poor returns across areas including workforce, technology and supply chain.

Kelvyn Sampson, retail, leisure and hospitality industries leader at Marsh Risk UK, said: “UK retailers have spent years becoming better at fighting fires. The danger now is that constant firefighting has become the strategy. With disruption increasingly a permanent feature of doing business, retailers need to continue looking beyond the last crisis and ask whether their investment is making them more resilient to the next one.

“That means being more disciplined about where money is spent, bringing frontline and risk perspectives into decisions earlier, and measuring resilience by how well the business can anticipate, adapt and recover, not simply by how much it spends.”

The report also found a disconnect around employee safety. While 85% of business leaders said physical safety was being managed well, this fell to 72% among people leaders. Retail crime and in-store safety incidents were among the reported sources of disruption.

---