A survey of 250 British retail decision-makers released today by Global-e, the cross-border e-commerce specialist, reveals that 3 in 5 (60%) retailers have made no business plans whatsoever should a Brexit go ahead in June; a little over a month away. In fact, 96% of retail sole traders have made no business provisions at all for a potential Brexit.
Among the cross-section of retail businesses surveyed, medium-sized retailers (100-249 employees) are most prepared for a potential Brexit with over a half (54%) saying they have made plans as a business already. This group was also most in favour of a Brexit, with 54% saying that they will vote to leave the European Union, compared to under a quarter (24%) of respondents in companies with more than 500 employees.
This research by Global-e was carried out to better understand the impact of potential Brexit on the UK retail industry. Key factors assessed include cost of goods, international expansion, cross-border sales and the impact on consumer confidence.
Nir Debbi CMO and co-founder of Global-e, said: “Now is an uncertain and potentially disruptive time for British retailers, particularly those that are operating across European borders. Cross-border commerce is driven by consumers looking for more choice online. Our findings show that even if the British public chooses to leave the EU, retailers are confident that the positive upward trend will continue. The important thing for retailers today, is therefore to prepare their operations in the short term to tackle the complexities that may incur due to the Brexit decision and the potential trade agreements changes, and continue long term plans to take advantage of rapid growth in cross-border ecommerce.”
The research found that in the event of Brexit:
- Economy: over half (53%) of UK retail decision makers polled said that a Brexit will make the economy weaker and importing goods from overseas will become more expensive, compared to almost a quarter (24%) who said they think it will make the economy stronger
- Consumer confidence: four in 10 (42%) UK retail decision makers said that they think consumers are likely to reduce spending. Over half of the UK retail decision makers polled (52%) think that prices in UK stores are likely to increase, while almost a quarter (24%) said they don’t think there will be any impact on consumer prices in the UK
- Cross-border sales: 67% of UK retail decision makers said they are confident that their business will continue to flourish internationally should a Brexit go ahead. When asked about cross-border sales to EU countries, many retailers (38%) believe that selling to the EU will become more complex, yet a further 26% aren’t expecting any impact at all. If a Brexit were to go ahead 20% of retail decision makers would consider moving their headquarters to within the Eurozone
Debbi continues: “Our research shows that although the majority of retailers believe that a Brexit will result in a weaker economy (including weaker Pound sterling Vs. Euro), they aren’t making preparations to tackle the cross-border selling complexity that almost 40% of them believe will incur following it. The EU remains a huge sales opportunity, with cross-border sales in Europe set to hit €40bn by 2018 according to Forrester. With the right preparation for both scenarios, technology and processes in place, retailers can continue to see sales grow and conversion rates improve whether the UK is in or out of the European Union.”
Global-e is a leading European provider of cross-border solutions for e-commerce retailers. The company, headquartered in Farringdon, London, enables retailers to provide a fully localised e-commerce offering to customers in more than 200 destinations worldwide. Global-e is working with a growing number of leading retailers, including Crabtree and Evelyn, Astley Clarke, Illamasqua, and Griffin Technology.