Petrol prices in the UK have surged to 18-month highs in recent days amid acute supply disruptions caused by the growing conflict in the Middle East – and with a near-term resolution in doubt, prices at the pump may continue their upward ascent in the coming weeks. As a net energy importer, the UK is particularly vulnerable to fuel supply issues, and as a consequence, British consumers may soon face difficult trade-offs as gas spending eats into already-tight household budgets.
The impact of any resulting cutbacks in consumer spending is unlikely to be distributed evenly across retailers – with lower-income and suburban/rural households allocating a larger percentage of budget to fuel spending, brands catering to these demographics could see a disproportionate impact from ramping fuel costs.
Using CE’s UK credit and debit card spend data, we conducted a UK-focused share-of-wallet analysis (following our look at US brands here) to uncover the brands whose customers* allocate the highest proportion of their expenditures on fuel, highlighting the merchants potentially most sensitive to increasing gas prices.
Key takeaways:
- Apparel, Accessories and Footwear: sports and outdoor brands ranked highest, fast-fashion less exposed.
- Customers of JD Sports, JD-owned Go Outdoors, Frasers Group’s Sports Direct, and Primark spend the highest percentage of their budgets on fuel – likely reflecting both demographic and geographic mix – while fast-fashion groups like H&M, Zara, and Uniqlo’s under-indexed, perhaps owing to customers’ urban skew and higher incomes.
- Limited-Service Restaurants: Fast-food over-exposed, urban-focused chains more insulated.
- Burger King, KFC, Greggs, and McDonalds – which offer wide geographic coverage and in some cases drive-through service – are more exposed to shoppers with high fuel wallet share, while city-center cafes like Caffe Nero and Pret are less vulnerable.
- Among pub chains, Marston’s and Wetherspoons have higher exposure, while London-centric Young’s shows less.
- Grocery: Value-focused chains show elevated fuel share.
- The Co-op, Asda, and discounters Aldi and Lidl are relatively over-indexed to those allocating a large proportion of budgets to gas, although market leaders Tesco and Sainsbury’s are close behind – while higher-end concepts M&S and Waitrose ranked at the bottom, likely reflecting customers’ higher household earnings.
- Department Stores: High-end brands less likely to feel the impact of rising gas prices.
- Customers of off-price leader TK Maxx and mass-market leader Next allocate a higher proportion of spending to fuel than those of upscale brands John Lewis and Selfridges – again likely indicative of the higher incomes of those brands’ customers, given broadly similar geographic mix among the larger department stores.
*Methodology note:
Brand customer defined as shopper spending <£20 at brand over the past twelve months
