Brexit, in some form, is on its merry way. With the track record of the British government in the past regarding their exit from the EU, it is highly unlikely that a deal will be reached by the 31 October 2019 deadline. Preparing to say goodbye is important so that your business can weather the storm.
To get through the changes that come with a no-deal Brexit, businesses can't afford to put faith in politicians to produce a Brexit resolution. This comes from the Institute of Directors (IOD) this week as we are only around 4 months away from the Brexit resolution deadline. Many business leaders haven't slowed their Brexit preparation work, even though the deadline was moved all the way to 31 October 2019.
The deadline presents a special challenge for retailers. This is because they will be deep in their prep for Black Friday and the peak pre-Christmas season. Black Friday is a little less than a month after the Halloween deadline, and if patterns from previous years are any indication, retailers decide to run discounts early. That means there will be a stockpiling of goods running up to Black Friday and Christmas, with retailers storing large amounts of stock again and again up to the holidays.
According to internetretailing.net, Edwin Morgan, interim director of the business organisation IOD, said businesses must take real action. According to a new survey by IOD, a no-deal Brexit would harm the businesses of those surveyed, and that some conservative leadership candidates like current front-runner Boris Johnson, say the UK must leave by 31 October – deal or no-deal.
What Retailers Are Saying
The findings at IOD are a lot like recent concerns at the British Retail Consortium (BRC). The BRC chief executive Helen Dickinson had this to say:
“The BRC has consistently made the case that a No Deal Brexit would see the prices of many everyday items rise. Our own research suggests that currency depreciation, additional documentation checks and requirements, tariffs on some goods, as well as delays at the border, would all contribute to higher prices and a reduced selection. The October 31 deadline is a particularly busy time for retailers. Not only are they stocking up for Black Friday and Christmas, but the proportion of food products imported from the EU is significantly higher than during the summer months. This would exacerbate the impact of a No Deal for both consumers and retailers. Businesses are spending hundreds of millions of pounds putting in place mitigations against a no deal Brexit – this represents time and resources that would be better spent improving customer experience and prices. Retailers cannot continue to spend this money indefinitely. MPs must find a compromise which can avoid a disastrous no-deal scenario.”
Joe Farrell, vice president of international operations at logistics business at pfscommerce agrees with the findings at the IOD:
“Figures from the IOD have revealed that despite a seven month delay, less than half of businesses have Brexit plans in place. This news serves as a stark reminder that online retailers, who trade both in the UK and EU, need to act now in order to protect their customers from the implications a no-deal Brexit could have on cross-border trading and therefore the overall fulfilment experience. Whilst many retailers have considered splitting their inventories, basing fulfilment in both the UK and the mainland continent, time is running out. Pop-up fulfilment centres however, could serve as a short-term solution to this. These temporary distribution centres can be rapidly deployed to serve a particular region and can boost customer experiences with fast delivery times. Whilst the post-Brexit future still remains unclear, one thing is for certain – e-tailers must ensure they are agile enough to adapt. Preparation will be the key for online retailers navigating the stormy seas of Brexit and will be crucial to survival in today’s turbulent market place. Being able to respond to the challenges of Brexit will be essential in providing a seamless delivery experience that meets or exceeds customer expectations.”
What You Should Do
If you are an e-business owner operating in the EU, the UK or both, or are doing business from outside the Euro/British zones, you need to prepare for what Brexit will bring – deal or no-deal.