LONDON, December 26, 2025 – UK retailers face a sobering Boxing Day as sales are projected to fall by a staggering £1 billion compared to 2024, according to a major financial forecast. This significant decline highlights how persistent cost-of-living pressures continue to fundamentally alter consumer behavior during the crucial festive trading period.
Boxing Day Sales Forecast Reveals £1bn Shortfall
Barclays, which tracks nearly half of all UK credit and debit card transactions, projects Boxing Day 2025 will generate £3.6 billion in retail sales. Consequently, this figure represents a substantial reduction from the previous year’s performance. The anticipated £1 billion shortfall delivers a direct blow during the retail sector’s “golden quarter,” traditionally its most profitable period.
Several interconnected factors drive this projected downturn. Firstly, household budgets remain constrained after several years of elevated inflation and interest rates. Secondly, consumer confidence has not fully recovered to pre-pandemic levels. Thirdly, a strategic shift in shopping behavior prioritizes value over impulse purchases.
Consumer Sentiment and Spending Intentions
Barclays’ research reveals a cautious consumer base. Seven in ten shoppers confirm ongoing price pressures will directly influence their Boxing Day expenditure. Furthermore, the proportion of people intending to participate has slipped to 26%, down from 28% in 2024.
However, the data reveals a nuanced picture. Those who do plan to shop intend to spend more individually. The average planned expenditure rises to £253, up from £236 last year. This suggests a market of fewer, but more determined and strategic bargain hunters.
- Stocking Up: Nearly half (48%) of shoppers plan to use discounts to stock up on familiar products at lower prices.
- Essentials Focus: One in four (25%) intend to focus solely on essential items.
- Category Demand: Clothing remains the top category, followed by food and drink, and beauty products. Shoppers show particular interest in securing premium brands at reduced prices.
Expert Analysis: A Year of Cost-Consciousness
Karen Johnson, Head of Retail at Barclays, provides critical context. “Shoppers have demonstrated just how cost-conscious they are throughout 2025,” she states. Johnson anticipates this trend will dominate Boxing Day spending. She notes the disappointing retail run-up to Christmas, with sales falling 0.2% in November and remaining approximately 3% below pre-pandemic levels.
“Consumers continue to prioritise saving,” Johnson explains, linking current behavior directly to years of financial pressure. This environment forces retailers to compete not just on discount depth, but on perceived value and necessity.
The Technology Transformation in Bargain Hunting
Artificial intelligence now plays a pivotal role in how consumers approach sales. Shoppers increasingly use AI tools to compare prices across retailers, generate personalized gift ideas, and set alerts for specific products. Barclays data shows two in five (40%) shoppers will employ AI to hunt for the best Boxing Day deals.
This technological adoption carries a paradox. While AI empowers smarter shopping, half of surveyed consumers express concern that the technology’s personalized recommendations could inadvertently encourage overspending. This tension between efficiency and temptation defines the modern sales experience.
The Enduring Appeal of the In-Store Experience
Despite the digital shift, the physical store retains significant importance. Most consumers still plan to conduct at least some shopping in-person. Many cite the Boxing Day shopping trip as an ingrained part of the festive tradition—an experience that extends beyond mere transaction.
“Boxing Day remains a pivotal moment for retailers, fuelled by Christmas nostalgia,” observes Karen Johnson. “But it has evolved to reflect modern consumer demands, where value, convenience and technology increasingly shape how people shop.”
For a significant minority, however, the day’s meaning has shifted. Almost a quarter (23%) of people believe Boxing Day should be spent at home with family rather than on the high street, signaling a cultural reassessment of post-Christmas rituals.
Broader Economic Context and Retail Implications
The weaker Boxing Day outlook follows broader economic challenges. The UK economy has faced consecutive quarters of adjusted growth, with real wages struggling to outpace lingering inflation in essential categories like food and energy. This macroeconomic backdrop directly suppresses discretionary retail spending.
Retailers now operate in a market defined by value-seeking. Success depends on several key strategies:
- Precision Stocking: Aligning inventory precisely with proven demand for essentials and value-led premium items.
- Omnichannel Integration: Seamlessly blending in-store experiences with digital price comparison and convenience.
- Communicating True Value: Moving beyond percentage discounts to clearly articulate product longevity and cost-per-use.
Conclusion
The forecasted £1 billion drop in Boxing Day sales serves as a powerful indicator of the UK’s ongoing economic adjustment. Consumer spending patterns have fundamentally recalibrated around necessity, value, and technological aid. While the Boxing Day sales event persists, its character transforms under cost-of-living pressures. Retailers must adapt to a landscape where fewer shoppers spend more deliberately, guided by AI and driven by financial pragmatism rather than festive frenzy. The 2025 figures underscore a retail sector navigating a prolonged transition towards sustainable, value-led consumption.
FAQs
Q1: How much are Boxing Day sales expected to fall by in 2025?
Barclays forecasts UK Boxing Day sales will reach £3.6 billion in 2025, which is approximately £1 billion less than the total generated in 2024.
Q2: Why are Boxing Day sales expected to decline?
The primary driver is sustained cost-of-living pressures, including prior years of high inflation and interest rates, which have made consumers more cost-conscious and likely to prioritise saving or essential spending.
Q3: Are people spending less individually on Boxing Day?
No. Interestingly, the average planned spend per shopper is actually higher (£253 vs. £236 in 2024). The overall sales decline is due to fewer people participating, not lower individual spending.
Q4: What role is technology playing in Boxing Day shopping?
Artificial intelligence is significant. Two in five shoppers will use AI tools to compare prices, find deals, and get gift ideas. However, half also worry AI could lead to overspending.
Q5: Is in-store shopping still popular on Boxing Day?
Yes. Despite online growth, most consumers plan to do some in-store shopping, with many valuing the experience as part of the festive tradition. However, almost a quarter of people now prefer to spend the day at home.
