Same-day delivery specialist Diamond Logistics has challenged the notion that economic uncertainty leads to a sharp decline in retail activity after significantly outperforming expectations this year.
The company, which has 35 fulfilment sites around the UK, said that from January through to May, it was 15% ahead of target while warehouse utilisation remained strong.
Diamond said this demonstrated that there continued to be resilience in underlying consumer demand.
Despite initial fears of consumer confidence taking a hit, largely due to households feeling the pressure of rising costs and ongoing uncertainty linked to instability in the Middle East, the British Retail Consortium reported that retail sales had actually risen 3.7% year-on-year in May, marking the strongest increase since April 2025.
Diamond said warehouse utilisation remained strong going into Q3 and goods continued to move consistently in and out of sites, with no noticeable drop in demand across essential or non-essential categories.
Kate Lester, chief executive and founder of Diamond Logistics, said: “There’s no question the UK economy is under pressure right now, particularly with ongoing instability in the Middle East feeding through into energy markets which could lead to a temporary spike in inflation and a rise in interest rates.
“But what we’re seeing on the ground is that consumer behaviour is actually holding up much better than some of the headlines would suggest.
“That’s not only reflective of the growth we’re achieving but from a fulfilment perspective, volumes are still strong across our nationwide network, goods are still moving, and demand hasn’t fallen away in the way people might expect in this kind of climate.”
Lester said during tougher economic periods, consumers do not tend to stop spending on non-essentials altogether, but rather buying behaviour changes.
“In the last six years we’ve faced Covid, a succession of wars, persistent inflationary pressure, and ongoing uncertainty around interest rates.
“As a result people have become considerably more accustomed to an environment where things don’t necessarily feel particularly stable.
“We’ve also been around for a lot longer than six years and the pattern we’ve seen emerge over that time, especially during periods of economic uncertainty, is that although consumers might well pull back on bigger-ticket purchases, they will still allow themselves smaller, more affordable treats that feel manageable from a cost perspective.”
She added: “While that shift could well be a factor in our volumes remaining strong, I think in general consumers are simply becoming much more resilient and have a better understanding that, rather than pulling back from spending altogether when times are tougher, and budgets become squeezed by rising costs of essentials such as bills, their spending habits often just need to adapt slightly.”
The International Monetary Fund upgraded its UK growth forecast to 1% last month for 2026, warning that ongoing geopolitical instability and domestic uncertainty could still weigh on growth.
The GfK Consumer Confidence Barometer also fell by four points in April, reaching its lowest level since autumn 2023, but it has since risen by two points.
