Retail sales down 0.1% in 3 months to August and retailers' woes in key Christmas run-up amplified by design theft epidemic

RETAILERS are under the cosh, with sales down 0.1% in the three months to August and experts concerned about additional taxation in the November Budget hitting consumer spending following dire public sector borrowing figures. To make matters worse, as the important festive trading period begins, many small, independent retailers are losing out to a design theft epidemic.

With Christmas looming, small creative businesses say they’re being ripped off at scale, with almost nine in ten telling Not On The High Street (NOTHS) they’ve seen their designs copied and cheaper versions made available.

According to NOTHS, 88% of respondents said their creations has be copied or closely mimicked, with 62% saying it happened on a larger marketplace. Nearly two in five estimate £10,000 or more in annual losses, and one in six put it at £25,000 plus; 42% say it happened in the past six months. 

Tony Carr, owner of Create Gift Love, a small business that creates unique, personalised gifts like keyrings and bookmarks, is one victim of design theft.

He said: “I’ve seen my designs replicated on sites like Alibaba, AliExpress, and Temu, and it’s really frustrating. We employ a team of people and we want them to feel valued and a sense of purpose in their work, but this copying and lack of protection makes it difficult. It can be really heartbreaking.”

Carr says the ripple effects hit wages and morale. “We would love to pay our staff more, but with these hits, times are tough. I feel if there was more protection and we weren’t having to deal with people stealing so many of our designs, we’d be able to increase our staff’s wages, so this predicament is extremely frustrating to me as a business owner.”

Experts say this is now the reality of online retail. “That nearly nine in 10 businesses have had their products or designs copied is a shocking statistic,” said Marty Bauer, retail and ecommerce expert at Omnisend. He said ecommerce has opened new markets and boosted margins for small firms. “The problem, increasingly, is that there are companies out there that can manufacture similar items for a fraction of the cost — and they are watching.”

Bauer said best-sellers can be cloned in days, often leaving founders outgunned. “If something is selling like hotcakes on the internet, it can get picked up easily and can be a prime target for a low-cost manufacturer to enter the market with something less authentic but nearly as good, which, for many under-pressure consumers, is often good enough.

“The next challenge is that small retailers often lack the resources or time and energy to do anything about it. It can be hugely daunting if a major brand copies you. The government should be doing more to protect small UK creative businesses and fighting their corner when their products and designs are copied.”

Others report long, draining fights to protect their brands. Emma Burke, founder at sports lace manufacturer, Laceeze, said: “This has happened to us more than once. If it weren’t so damaging, it would almost be flattering that our unique product sells so well it gets copied by rip-off brands on Amazon, AliExpress, and elsewhere.”

Burke says logo blurs and tiny design tweaks are common. “They often blur our logo or tweak the design to dodge our IP, making takedowns more difficult, and even this week, we spotted one using our own product images. Last year, we finalised a long legal battle with a company whose copy was so close that we were being tagged on social media for their product."

Burke continued: "We hold patents and trademarks, which help, but in that case, their lawyers even attacked our IP at the IPO, leaving us as defendants. The reality is you must stay vigilant. We now focus on clear messaging. We are the original shoelace band, the award-winning brand, and the company that gives back to grassroots sport. Copycats will come, but staying on top is part of protecting what we’ve built.”

Some founders argue that quality and values can still win. Kerry Mackay of ScrubbiesUK, which manufactures home-compostable sponges, said: “As a small business, I produce a product that is easily replicated, but having sold over 120,000 of my compostable Scrubbies, any mass-production business trying to copy them will always fall short and move onto something else.” 

She says that the approach is deliberate: “This is no accident; it is down to a core business principle placing social, economic and environmental impact above the need to make endless profit.

"When a small business is solely a profit machine, anyone with resources can replicate and outcompete it, especially in countries with lower costs. However, if you spread that profit around by buying the best materials, maintaining very high quality while simultaneously offering unbeatable wholesale and retail prices, it may not make you rich overnight, but it certainly provides sustainability and security within the marketplace.

"If most of the world lives in poverty and you don't make your products accessible to everyone, then it's only a matter of time before someone else will fulfill that demand.”

Lawyers say registrations can make or break platform takedowns. Steven Mather, lawyer and director at Leicester-based Steven Mather Solicitor, said: “I strongly recommend businesses that invest in their products, designs or brands to protect that intellectual property accordingly, whether trademark or design rights.”

But Mather says stopping overseas operators is tough: “The truth is, they’re unlikely to stop an overseas company from copying a top-selling product because of the costs of legal action, and it’s very difficult to enforce in places like China.

"However, shopping portals like Amazon and eBay do allow brands to stop copies - but only if they can show they have registered IP. So, registering a trademark and proving it to Amazon Brand Registry allows a business to stop copy products using that mark.”

AI is lowering the barrier to fakery, said Colette Mason, founder and AI systems architect at Clever Clogs AI. “AI can make the process of copying original designs so much easier. The already low barrier to entry has been made even lower.

"AI is transforming all industries and small creative businesses with unique products are not immune to it. Ecommerce can be empowered by AI but also exploited by it."

NOTHS says the playing field needs levelling as festive trading begins. Jessica Nesbitt, CEO, said: “We’re coming into such a crucial trading period for small businesses, and if their designs are being ripped off then it’s not a level playing field.

"Small brands are the backbone of the UK economy, driving innovation and contributing hugely to local communities. It’s the entire reason Not On The High Street exists, to support these small, independent brands. 

"That’s why we’ve created resources to help protect their designs and trade marks and better safeguard themselves. There’s information on intellectual property rights, practical tips on registering their designs or trade marks with the Intellectual Property Office, and even guidance on what to consider doing if their work is copied.”