What: Series of coordinated cyber attacks on M&S, Harrods, and Co-op reveals retail sector's systemic weaknesses in data security and operational resilience.

Why it is important: These breaches demonstrate how cybersecurity has evolved from an IT issue to a core business risk, directly impacting market value, customer trust, and operational capabilities.

The UK retail sector faces an unprecedented cybersecurity crisis as major retailers grapple with sophisticated attacks. Marks & Spencer's systems were infiltrated in February, forcing the suspension of online orders and disrupting contactless payments. The breach resulted in a £700 million market value drop and affected hundreds of employees, particularly remote workers. Similar attacks on Harrods and Co-op underscore the industry's vulnerability, while global incidents at Latitude Financial in Australia and various US retailers highlight the international scope of the threat. The digitisation of retail operations, including loyalty schemes and retail media networks, has expanded the attack surface considerably. These breaches demonstrate how cybersecurity now affects every aspect of retail operations, from brand equity to customer trust. The incidents have prompted a fundamental shift in how retailers approach security, moving from viewing it as merely an IT function to recognising it as a critical business imperative.

IADS Notes: The recent wave of cyber attacks on UK retailers reflects a dramatic escalation in both frequency and sophistication of threats to the sector. As reported in April 2025, the Scattered Spider group's attack on M&S proved particularly devastating, wiping £700 million off their market value and disrupting £3.5 million in daily digital sales. This incident triggered a chain reaction, with both Harrods and Co-op suffering breaches by May 2025, the latter exposing data of up to 20 million customers. These attacks have transformed the cyber insurance landscape, driving a 10% increase in premiums across the UK retail sector. Industry research from April 2025 reveals that ransomware now accounts for 30% of retail security incidents, with average losses reaching £1.4 million per attack, while third-party breaches represent 41% of reported incidents.

Cybercrime in retail: Trust is now at risk but that creates an opportunity