Insight: new study finds 68% of retailers have no Brexit plans in place
The survey of 250 retail decision makers by Global-e, also found that 51% of retailers polled said the vote to leave the EU has already impacted their UK sales.
The figures reveal that 21% of retailers have seen sales increase in the UK, while 30% have experienced a sales fall and 47% have seen no impact at all. Comparatively, some 32% of UK retailers that sell internationally have seen online orders from outside the UK rise as international shoppers take advantage of the weakened pound..
The study found that retailers are overwhelming positive about the future, with three-fifths of those polled stating that they feel confident or very confident that they can continue to flourish internationally once the government triggers Article 50.
Despite this confidence, some 48% of retailers said they expect the economy to weaken, making it more expensive to import goods. In turn, 63% expect consumer prices to increase in UK stores.
Nir Debbi, co-founder and CMO at Global-e, said: “As the Brexit bill moves through Parliament, retailers are facing up to the reality of what Britain’s exit from the EU might mean. Although some retailers have revised their plans, our research suggests that most are taking a wait-and-see approach, before considering whether to change course.
“In the months since the EU referendum took place, most retailers have already felt some impact, with many of those that operate internationally seeing an increase in sales from online shoppers worldwide due to the weakened pound and growing trend for cross-border ecommerce.”
Half of the retailers surveyed who sell internationally said they expect the UK’s departure from the EU to make cross-border ecommerce more complex. However, 44% stated that they are continuing with their existing international operations and 23% are planning to invest more in growing their business outside the UK.
Retailers were found to be divided on which ‘Brexit’ is best for business. Some 46% of UK retailers said they are in favour of a Soft Brexit with some access to the single market, while over a 36% thought a Hard Brexit, with no access to the single market, would be better.
In addition, more than two-thirds of retailers expect consumer confidence to be impacted and 63% said they expect prices in UK stores to increase once the government triggers Article 50.
Debbi concluded: “Our research suggests that the effects of Brexit on UK retail may be less black and white than some commentators anticipated. While many retailers that sell imported goods to UK shoppers have seen prices rise due to the weakened pound, those that sell to international shoppers on the web appear to be reaping the rewards of cross-border ecommerce, with 32% seeing sales increase.
“However, relying on currency fluctuations will not be enough for long-term success. To make a success of cross-border ecommerce in Brexit Britain, retailers should review the experience they offer to shoppers in Europe and around the world. With the right preparation, technology and processes in place, retailers can seize new opportunities and tackle any challenges created by Brexit, to drive online sales internationally.”
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