The cost of war: over 40% of retailers and transport and storage firms plan May price increases

6th May 2026

The true cost of the Iran conflict is hitting home for UK businesses and consumers, says the international delivery expert Parcelhero.

New figures from the ONS show a 22.5 percentage point increase in the number of transport & storage sector firms planning May price increases over April, with retailers and manufacturers not far behind.

The latest Office for National Statistics (ONS) Business Insights survey reveals over 40% of retailers and transport & storage sector firms plan to increase their prices this month.

Compared to April, many more retailers, manufacturers and transport & storage sector companies plan price increases this month. The shock figures reflect the equally sharp rises in costs UK businesses have faced since the start of the Iran conflict at the end of February, says the international delivery expert Parcelhero. It says transport & storage sector companies are leading the rise in prices, with retailers and manufacturers following close behind.

Parcelhero’s Head of Consumer Research, David Jinks M.I.L.T., says: ‘The results of the latest ONS Business Insights survey spell bad news for both British industry and for consumers. 41.1% of transport & storage sector companies say they plan to increase their prices this month, together with 40.5% of retailers and 35.2% of manufacturers.

‘To put these price increases into perspective, only 18.6% of transport & storage companies planned price increases for April, together with 25% of retailers and 21.5% of manufacturers. That’s a 22.5 percentage point increase in the number of transport & storage firms planning increases over last month, a 15.5 percentage point increase in the number of retailers planning a rise and a 13.7 percentage point increase in the number of manufacturers planning to up their prices.

‘The situation is even gloomier when compared to March, when the impact of the conflict was only just beginning to bite. In March, only 10.5% of transport & storage firms increased their prices, together with 24.6% of retailers and 13.5% of manufacturers.

‘The planned price rises for this month are not surprising when we look at the increase in the cost of services and goods that companies are now facing. When comparing March to February, 50.6% of transport & storage firms reported an increase in the price of goods and services they bought in March, as did 50.9% of retailers and 48.5% of manufacturers.

‘The bad news didn’t stop there. As the impact of the conflict hit, 26% of transport & storage businesses reported their turnover decreased in March, together with 27.2% of retailers and 25% of manufacturers.

‘There is no mystery over the source of escalating prices and falling demand. Of those companies that experienced global supply chain disruption in March, 49.9% of retailers and 48.5% of manufacturers cited conflict in the Middle East. Across all business sectors, 46% cited conflict in the Middle East as a reason for experiencing global supply chain disruption in March – a 34 percentage point rise from February, according to the ONS.

‘Businesses across all sectors face ongoing challenges created by the conflict. 27.6% of transport & storage companies, 43.9% of retailers and 37.4% of manufacturers said economic uncertainty was impacting their business. Across all business sectors that’s the highest proportion reported since the question was introduced in April 2022, says the ONS.

‘Looking specifically at the factors causing businesses to consider raising their prices this month, 34.1% of transport & storage companies named energy costs, as did 42.9% of retailers and 45.2% of manufacturers. Of course, the cost of energy has risen as the Iran conflict has continued.

‘One final cost increase facing British businesses is in transport, because of the disruption to the Strait of Hormuz and to international shipping and aviation across the Middle East. 41.6% of transport and storage companies said this was an issue that has caused them to consider raising prices this month. 36.4% of retailers and 40.6% of manufacturers also cited transportation or haulage costs as factors causing their businesses to consider increasing prices during May.

‘Unfortunately, the economic impact of the conflict does not look likely to lessen anytime soon. The fragile ceasefire between the US and Iran is currently under increased threat over the Strait of Hormuz blockade, while international supply chains will face continued increased costs and disruption for months, even if the truce holds.

‘For real-time information on costs and services, Parcelhero can help businesses and individuals to compare international services and costs for all the major carriers to over 220 countries and territories. For 24-hour service and price information, see https://www.parcelhero.com/en-gb/international-courier-services

The ONS Data
Nearly a quarter (23%) of trading businesses reported that their turnover had decreased in March 2026 when compared with the previous month, down 2 percentage points from February but in line with movements seen around this time in previous years; 16% of trading businesses expected turnover to decrease in May 2026, which is broadly stable compared with expectations for April.

Economic uncertainty remained the most reported challenge affecting turnover for trading businesses in early April 2026 at 35%, rising to 40% for trading businesses with 10 or more employees; these were up 3 and 6 percentage points, respectively, since March, and the highest proportions reported since the question was introduced in April 2022.

Four in ten (40%) trading businesses reported an increase in the prices of goods or services bought in March 2026 when compared with the previous month, 11 percentage points higher than February, and the highest proportion reported since December 2022 (41%); 15% reported an increase in the prices of goods or services sold, the highest proportion since April 2023 (16%).

Over a quarter (28%) of trading businesses expect the prices of goods or services they sell to increase in May 2026, up 6 percentage points compared with April and the highest since January 2023; 34% cited energy prices as a reason for considering raising prices in May, up 9 percentage points from April, the highest proportion since April 2023.

66% of businesses reported at least some level of concern about energy prices in early April 2026, up 11 percentage points from late March; this proportion was 76% for businesses with 10 or more employees, a rise of 2 percentage points from late March.

Almost 1 in 10 (9%) businesses experienced global supply chain disruption in March 2026, up 6 percentage points from February and the highest proportion since December 2022 (10%); of these businesses, 46% cited conflict in the Middle East as a reason for experiencing global supply chain disruption in March, a
34-percentage-point rise from February.

Read the full ONS report HERE