One Year To Go
We are now under one year away from 29th March 2019 when the UK will officially leave the European Union. What does this mean for your business?
The Government has not yet agreed with the EU what the terms of Brexit will be, so we don’t know exactly what will happen. However, we can plan for what is likely to happen.
On 26th March, in London, I hosted a talk for retailers of all sizes. We heard from four experts on from the legal, IT, retail and media industries. Each one gave us their thoughts on how retailers can prepare for Brexit.
I’ve put together a summary for you below that covers the five things you need to think about for your business.
Five Things To Think About For Your Business
1. Stock from the EU getting more epensive
Once we leave the European Union, we will not be able to bring goods in from the EU without paying additional charges (tariffs). If we “crash out” without a deal, these tariffs will be the standard charges agreed by the World Trade Organisation. If we negotiate a special deal, the tariffs will be agreed with the EU. One thing is certain, it is going to cost more to bring stock in from the EU after the end of the Brexit transition period in 2020.
2. Support from the Government
The Government must provide support for small businesses to help them understand the changes to imports and exports. At the moment, there is no information because no-one knows what will happen. So the Government will need to act quickly, once the terms are agreed, to help small businesses get ready. If you are a small business owner, write to your MP to tell them that they need to support you. Information on how to do that here
3. Minimise your risk
Nothing is worse for consumer confidence than uncertainty. Customers that are not confident don’t spend as much. So the next 12 months will be quite bumpy in the industry as a whole. If you are a new brand and have found a growing niche, you may not experience this. But it never hurts to be cautious - avoid over-buying stock unless you have good proof that you can sell it. Don’t be too pessimistic though - there may well be good opportunities within your niche - if you sell anything to do with stress relief for example!
4. Be prepared
Where do you get your stock from? If it’s from the UK, are there any parts that come from the EU? It’s worth having this conversation with your suppliers now. When we first leave in 2020, it will take longer to get stock in from the EU due to the ports being very busy. When you make your buying plans for that year, you will need to take that into account. If you worry that all your stock comes from EU sources, now is the time to start reaching out to other suppliers. Finding good suppliers and building relationships with them can take a long time.
5. Your EU customers
Be aware that your EU customers will also need to pay tariffs to receive orders that they buy from you online. This will mean you will either have to pass it on to them (making you more expensive) or pay that charge yourself (making you less money). If you worry that too many of your customers are from the EU, start building new markets now.
Make changes now
No-one has the answers, but now is the time to look at the extra charges you may have to deal with after Brexit. Build them into your plans and make any necessary changes to where you buy your stock from, or sell your products to.
If you’d like to come along to our next free event, we will discuss Amazon and how all retailers, big and small, need to have a strategy on how to respond to them. Our last event sold out, so please get your tickets soon! Pizza and Wine provided.
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