The general election: how could it affect retailers and merchants?

Politics is a particularly important consideration in the retail sector, and with a general election on the horizon builders’ merchants and construction industry traders can expect a number of significant changes over the coming months and years

01st May 2015

Numerous factors can influence the retail landscape, from weather conditions and seasonal changes to raw material costs and the economy. Politics is a particularly important consideration in the retail sector, and with a general election on the horizon builders’ merchants and construction industry traders can expect a number of significant changes over the coming months and years. It’s not always easy to predict how political machinations might affect the retail landscape, however, so here at Integrity Trader we’re going to take a look at the policies of five major parties and how they might impact merchants such as yourself.

The Conservatives

A number of Tory party policies are likely to impact upon the retail sector should they win the next election. The Conservatives plan no increases to VAT or NI contributions – which is good news for the retail sector – while one of the party’s key pledges is to eliminate the deficit by the end of parliament, helping to paint a brighter economic picture for the UK. The Tories also plan to triple the number of start-up loans in the next parliament, which would increase competition in the retail sector. The party aims to construct 200,000 homes for first-time buyers as well as 400,000 new properties on brownfield sites, so builders’ merchants may benefit from increased demand for products under a Conservative government.

The Green Party

As you’d imagine, many of the Green Party’s policies are concerned with the environment and sustainability. Many of these policies are potentially beneficial for construction industry retailers too ­– the Greens have earmarked £85bn to invest in home insulation, renewable electricity generation and flood defences, all of which will increase demand for associated traders. Rather than tax low earners and small businesses, the Greens wish to raise tens of billions in additional taxes for the wealthy, on bank transactions and by targeting tax avoiders. Some policies likely to benefit workers may cause angst among retail business owners, however – the Green Party aims to increase the minimum wage to £10 per hour by 2020, implement a maximum 35 hour working week and ban zero-hour contracts. The Greens will also build 500,000 social homes but ban the construction of out-of-town retail parks.


Labour also aims to increase the minimum wage – targeting £8+ per hour by 2019 – and like the Conservatives will not increase VAT, NI or basic and higher rates of income tax. Labour are planning to build an additional 200,000 homes per year until 2020 in an effort to tackle the housing crisis, with a focus on more affordable homes. The party are planning to cut the deficit every year and will freeze energy bills until 2017, helping retail businesses to reduce their expenses. Both the Labour Party and the Conservatives will devolve business revenue powers to local authorities, helping to ensure that business rates are fair throughout the regions. Labour are also planning to target corporate tax avoidance – something that all small businesses can appreciate. 

The Liberal Democrats

Like many of the other major parties the Liberal Democrats will also look to cut the deficit and balance the books, and like Labour, the party will seek to do so through a mixture of cuts and taxes on higher earners. The Lib Dems will raise corporation tax but specifically in the banking sector, and will increase house building to 300,000 properties per year. The party will also ban landlords from letting out poorly insulated homes, potentially increasing demand amongst builders’ merchants. The Lib Dems will also invest heavily in alternative energy, aiming for a zero-carbon Britain by 2050.


The main thrust of UKIP’s manifesto involves leaving the EU altogether – doing so is likely to impact the retail sector, limiting trade with other European nations and potentially destabilising the UK economy. Beyond this, UKIP will cut business rates for small businesses and build a million homes on developed land by 2025. The HS2 railway project will be scrapped, leaving a vacuum in infrastructure construction, but UKIP will invest heavily in the UK defence sector, increasing it ‘substantially’.

At the time of writing it seems likely that no party will achieve a majority in the next election, meaning that another coalition government is very much on the cards. No matter what happens in the general election, builders’ merchants and construction industry retailers need to be ready for significant changes to the retail landscape. Our retail point-of-sale software can help you prepare for and respond to those changes. Contact us today to find out more.

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