Independent British retailers defy retail downturn with 43% exports boost on Shopify in 2021

28 April, 22

The Shopify Economic Impact Report conducted by Deloitte has revealed how British independent retailers are continuing to fuel job creation and local economic growth, with exports helping UK merchants thrive despite macroeconomic headwinds.

Shopify merchants give UK economy export boost

Record numbers of UK independent retailers broke international borders in 2021, profiting from a boost in exports. Exports from UK Shopify merchants reached $3.7 billion (£2.7 billion) in 2021, representing a 43% increase from the $2.6 billion (£1.9 billion) made through exports in 2020, as retailers turned their attentions to international growth.

Dave Linton, founder of Shopify customer Madlug, which donates a bag to a child in care for every bag sold to a customer, is continuing to expand overseas and credits the ability for small independent brands to forge a close connection to their customers. He commented: “Once customers are connected to a brand’s mission and purpose, they are willing to continue spending with that brand, even in the face of inflation, rising living costs and international shipping charges. In the past year, we’ve seen strong sales to Europe, Canada and America and some sales also to Australia and Dubai. We have also been able to hire two more young people who have been through the care system themselves and add great value to our business as a result.”

British businesses building on Shopify are an engine room for job creation

UK Shopify merchants – success stories including Huel, Ooni, Mamas & Papas and War Paint for Men – collectively contributed £12.6 billion to the national GDP and created 197,100 jobs in 2021, increasing year on year by 65.7% and 74.7% respectively. This is set against a backdrop of a turbulent year for retail where 105,727 retail jobs were lost, according to the Centre for Retail Research

Shimona Mehta, EMEA Managing Director at Shopify, comments: “Innovative British businesses are creating jobs at a rapid clip despite the odds and continue to flex their entrepreneurial muscle: something that will be increasingly important as we navigate the cost of living crisis ahead. Not only does it underline the UK’s potential as a powerhouse for entrepreneurship, but the role that commerce is playing in driving economic growth and job creation.”

British retailers on Shopify show resilience to power economic growth

As the British economy re-opened in 2021, retailers born online with Shopify in the pandemic were able to quickly launch stores on the high street. And Shopify has helped traditional off-line retailers expand online. They’ve been able to thrive on Shopify by selling to customers wherever they are, whether that’s in-store, online, or on social media platforms like TikTok and Instagram. Although rising inflation and cost of living has impacted recent online sales more broadly, UK independent retailers on Shopify have proved resilient to the broader downturn with Shopify merchants in the UK alone contributing £25.6 billion to the UK economy, up 58% from 2020.

Dave Linton at Madlug explains: “Our sales now are better than they were pre-pandemic. It’s likely they’d be better still if it weren’t for the current economic climate, but we are finding that customers are still willing to spend for the right brands, products and causes that matter to them. In that way, I’m glad to say small independent businesses with strong brands seem able to escape some of the worst of the retail downturn.”

The Shopify effect

The figures in the Shopify Economic Impact Report show ‘the Shopify Effect’: a ripple impact of entrepreneurship that extends far beyond the borders of individual businesses. For every £1 made by Shopify last year, its merchants made £38. The proof is in the numbers, but it’s not only about economics; it’s about people and entrepreneurs behind them.

Shimona Mehta, EMEA Managing Director at Shopify, comments: “The Shopify Effect is a ripple impact of entrepreneurship that extends beyond individual businesses. We firmly believe that the UK economy is stronger with a greater diversity of independent businesses and entrepreneurs. From emerging brands like Mad Lug to giants like Huel, businesses building on Shopify are bucking the trend, showing resilience and adaptability to export more and sell to consumers wherever they are.”

Other key findings from the 2021 Shopify Economic Impact Report:

Shopify merchants sold $25+ billion worth of goods and services outside their home country in 2021. Small businesses generated $11 billion of those sales.
Merchants in developing nations generated $6.5+ billion in revenue in 2021, up from $5.8 billion in 2020.

Shopify’s Partner ecosystem – which includes developers, designers, marketers, accountants, logistics providers, and other experts who help our merchants succeed – supported 656,000 jobs and generated $32 billion in revenue** last year.
Partners increased their earnings 45% from 2020, grossing more than 7x Shopify’s 2021 revenue.

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