A new report, The State of Sourcing Report: Sourcing and Sustainability in 2025, by Source in collaboration with Insider Trends, sheds light on evolving sourcing practices and sustainability efforts among UK retailers. Surveying businesses from small enterprises to large corporations, the report underscores advancements in global sourcing while revealing fragmented sustainability approaches.
Key findings indicate that 84 per cent of businesses with over 50 employees and 71 per cent of smaller businesses source internationally, with China (48.8 per cent), the UK (41.6 per cent), and India (36.8 per cent) leading sourcing destinations. Smaller businesses prioritize local sourcing due to limited capacity and cost considerations. Larger companies, meanwhile, extend their global footprint to regions like Southeast Asia and Turkey.
Sustainability remains a mixed priority. While 69.23 per cent of respondents report progress, the sector faces barriers including limited resources, regulatory complexity, and greenwashing concerns. Smaller businesses lead in authentic leadership on sustainability, with over 50 per cent demonstrating dedicated leadership. Larger retailers, however, often allocate greater resources to structured sustainability initiatives.
Cost efficiency (45.6 per cent), innovation (35.48 per cent), and supply chain risk mitigation (32.26 per cent) drive sourcing decisions. However, sustainability ranks higher for smaller businesses, reflecting consumer demand for eco-friendly alternatives.
Despite consumer pressure and impending regulations, such as the UK’s Digital Markets, Competition and Consumers Act (effective April 2025), which penalizes greenwashing, many businesses are hesitant to make bold commitments. Almost half of respondents lack plans to increase sustainability funding, citing competing priorities and financial constraints.
The report calls for systemic changes, including clearer regulations, financial incentives, and collaborative efforts across the industry. It emphasizes that addressing sustainability in isolation hampers progress.
Suzanne Ellingham, Sourcing Director at Source, highlights, “Collaboration, transparency, and innovation are key to balancing environmental goals with business realities. By pooling resources and embracing partnerships, the industry can create meaningful change by 2025.”
The findings will be explored during an online webinar on December 10th, as businesses strive to align sustainability with profitability in an increasingly complex global market.
