The UK government has started to make moves towards their exit from the EU, but we started to see changes to our economy almost immediately after the vote itself, so how will these next few months affect our industry?
A recent survey by Crewe based insolvency practitioners, MGJL, has reported that around 30% of retail business have already seen a negative impact on their business. With imports and exports already being one of their highest outgoings, the break away from the EU could see these rise even further for retail business, causing more damage and more concern for owners.
With 30% of retail businesses stating an impact since the announcement of Brexit, a further 16% said that they expect to see an impact within the next few months.
The UK’s retail industry has faced a number of setbacks over the last few years, with many high-street stores being undercut by online retailers and hit hard by ever increasing rental costs.
This has led to a number of much loved chains disappearing, such as BHS, Woolworths and JJB Sports. Many small town high-streets are filled with empty and unused shops due to how expensive it is to rent and running an online store being a much cheaper and more profitable alternative.
Some might argue that Britain leaving the EU opens up the opportunity for retail businesses to barter the cheapest deals from around the world, however, it will cause some difficulty and substantial changes when it comes to trade within Europe.
There’s also the need to pay closer attention to individual country’s legal requirements. If a retail business operates in a number of different countries, then they will need to crack down and ensure they are properly complying with every different country’s legal requirements.
As it is expected that we will experience very slow growth in our economy after Brexit is fully actioned, there may also be an unemployment issue. Retail businesses should be prepared for this, amongst the number of other changes expected. This may include being wary of hiring new employees or paying close attention to salary rises.
Researching into current laws and legislation within the countries you currently trade in is a great place to start. Make sure you are prepared to deal with changing the way you conduct business with countries within the EU can help you create a more seamless transition when the time comes.
Being careful with finances and preparing for slow economic growth, as well as changes to import and export costs, will also help to prepare your business for Brexit.
Pay attention to new government announcements over the next few months -nobody knows for sure what will happen once we finally leave the EU, but being as prepared as possible for change is the best way to tackle the ever changing landscape.