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You are here: Home Focus "No Deal" with EU Brexit Negotiators Continues to Affect UK Retail Sector

"No Deal" with EU Brexit Negotiators Continues to Affect UK Retail Sector

06 July 2018, 22:28 CET

As UK politicians and Brexit negotiators remain in a deadlock with their EU counterparts, the prospect of a 'no deal' scenario is having a ripple effect on the UK retail sector. The Institute for Public Policy Research has produced a report stating that people living outside London will have to deal with rising prices as retailers face increased production costs.

UK EU

Northern Areas at Risk

Economists are warning that the north-east and Wales are particularly at risk. These areas have a disproportionate reliance on the EU, as many goods are exported there, including meat, cars and airplane parts. This will have a knock-on effect on many lower-income families. Another report produced by a consultancy firm drew similar conclusions. It found that increased export tariffs to EU countries would lead to price rises for all UK consumers. Experts believe that Northern Ireland would be one of the worst areas hit.

The Rise of Online Stores

The UK retail sector is already suffering from diminishing demand for bricks and mortar stores. Customers are increasingly choosing to buy goods from internet retailers rather than high street shops. Many brands are being forced to close stores and streamline their operating costs. It's clear that unless brands adapt and evolve as Brexit draws ever nearer, more will go to the wall.

Many experts are talking about the effect of trade tariffs if no trade deal is agreed, but there are other costs to consider. Extra checks on EU borders will be just as damaging. Indeed, the issue of the Northern Ireland border is proving to be a serious thorn in the side of the government.

Cutting Costs to Protect Your Business Post-Brexit

By cutting costs, brands can future-proof the business. Technology is an essential part of this process. Large brands can use enterprise solutions such as online data capture devices that upload into an Enterprise browser. Smaller businesses can implement barcode scanners and maintain tight control of their inventory.

There are various technology solutions available for businesses of all shapes and sizes, so it is critical that you look at your operating costs and see where you can save money.

Move Online

One easy way businesses can save money is by switching their operations online. Operating a store is an expensive business. You have overheads such as rent, maintenance, utilities, business rates, and staffing costs. Increasing numbers of customers are shopping online because it is convenient and cost-effective, so it makes sense to harness this trend.

E-commerce sites are growing in popularity. Amazon is now the biggest online retailer in the world, with millions of customers. You can't beat Amazon, but you can join them by opening your own virtual store. If you still want to maintain a brand presence on the high street, keep your flagship store open in the most profitable area, but concentrate on building the online portion of your business.

This will make it easier to continue growing after Brexit.

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