Retail sales in France, Germany, Italy, Spain and the UK will rise from €2.3 trillion in 2023 to reach €2.7 trillion by 2028 at a 2.9 per cent compound annual growth rate (CAGR), according to a new report from research firm Forrester.

The company expects that in-store sales will rebound to pre-pandemic levels in 2024 but online retail will continue to grow due to factors such as a wider product selection and competitive pricing.

The report said that online retail sales in the five countries will increase from €372 billion in 2023 to €579 billion in 2028 at a five-year CAGR of 9.2 per cent. Online sales will represent 22 per cent of total retail sales in these five markets, compared to 16 percent in 2023, it added.

Germany has the biggest retail share out of the five countries and total sales in the country are expected to reach €680 billion by 2028, up from €585 billion in 2023. Offline retail sales will reach €527 billion in 2028, up from €490 billion in 2023.

The UK has the second largest market share of the countries covered in the report and online sales will represent 32 per cent of total sales by 2028, up from 27 per cent in 2023.

“Post-pandemic consumer behaviours, global supply chain issues, and a weak economy are all significant factors that have impacted the European retail market over the past few years,” said Jitender Miglani, principal forecast analyst at Forrester. “However, as inflation cools and the economy stabilises, we expect both offline and online retail sales to grow at pre-pandemic levels for the first time in 2024.

“To take advantage of this expected growth, European retailers need to focus on enhancing their digital presence, building supply chain resilience, and implementing customer-centric strategies.”

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