Anticipating Post Brexit eCommerce

As Boris’ Brexit deal gains an overwhelming amount of support from the residents of the UK, are we finally about to face what a post-Brexit Britain will be like? 

 We’ve been told the stories, read the headlines, but what does Brexit mean for online retailers in the UK? Well, to give you a brief rundown; 91% of adults occupying our humble British Isles use the internet, contributing to the third largest eCommerce market in the world, with China and the USA holding first and second place. This makes our shares in the eCommerce sphere quite prevalent and a no-deal Brexit that more daunting.

 The effect on eCommerce at present

 We’ve endured four months of negative sales growth since March with Britain’s eCommerce having the worst month in recorded history, growing at a measly 0.7% in comparison to the previous year. With tensions rising, there’s an evident decrease in customer confidence in the current climate. However, with an end to Brexit negotiations near in sight, it is still uncertain whether the UK will leave with a deal or not, or potentially yet another tedious extension.

 What will the future hold for online retailers?

 But it’s not all doom and gloom. Andy Mulcahy, Strategy and Insight Director, IMRG, says retail is likely to be more protected from the effects of Brexit than other sectors.

Mulcahy: ‘The macroeconomic climate – which must be linked to some extent to the looming Brexit deadline – does seem to have exerted some influence over online retail sales growth in recent months. That said, retail should be more protected against possible impacts than other sectors; while the housing and car markets are having a tough time, it does mean people are making less of the really high-expenditure purchases which, in theory, leaves more for the lower-cost, more regular purchases made on retail sites.

‘A caveat to that would be if things get very volatile over the next few months, with currency fluctuations hiking up prices of certain products. But one factor that can never be overlooked in retail is the impact of the British weather. February has been exceptionally warm, which may be stimulating sales activity for fashion retailers selling new season products. If we get favourable weather in March / April, that may be a significant driver of sales growth – if it’s cold and our exit from the EU doesn’t go well, it could be a very tough time.’

 How should we prepare for post-Brexit eCommerce?

 To put it bluntly, there are only two outcomes: deal or no deal. Unfortunately, preparing for both eventualities would require a large number of resources dedicated to finding the best solution for your business. This is an unrealistic option for the vast majority of retailers, particularly SME’s. Hence, it’s recommended that online retailers focus on what they can control. But don’t fear. GOV.UK has provided a plethora of advice to help all variants of business prepare for Brexit, whatever the outcome — providing advice on everything from exporting, importing, employing EU citizens, protecting intellectual properties and more. Whatever Brexit is on the near horizon for Britain, it won’t be long until we know for sure. Probably.

If you have any questions about anything discussed in this blog or if you’d like to chat about a project, feel free to get in touch. We’re always happy to help businesses reach and surpass their eCommerce potential.