Over recent months, there has been hardly any issue that created a more all-absorbing stir than Brexit. Beyond any doubt, it is a much-debated decision of the United Kingdom that keeps business owners guessing until a long way of leaving the EU comes to an end. The process is surrounded by lingering uncertainty, meaning that neither employees nor entrepreneurs know what should be expected from the upcoming changes. Being kept in the dark about trade details and new cross-border regulations makes preparing for Brexit much like trying to find a way through the maze while wearing a blindfold.
What the facts show is that Brexit will close the door to the EU markets, blocking unrestricted access to hundreds of millions of prospective buyers and billions of pounds in potential profits. For some, this may be a hit that they will not be able to survive. For all e-tailers, though, this should be seen as a sign to adapt to the changes and rethink their strategies.
What Brexit effects on businesses you should be aware of
Leaving the EU will take its toll on all business sectors, online shopping in particular. Considering that ecommerce in Europe is on the dramatic rise and is worth around €600 billion (and counting), being cut off from such a massive pool will result in an increasing number of companies impacted by Brexit financially.
If the UK moves away from the EU VAT area, cross-border transactions will be way more complicated. When the privileges of free movement of goods are eliminated, organisations will encounter additional administrative fees, local tariffs and levies, not to mention increased VAT rates. This can cause severe damage to your business budget.
Although there is a lack of clarity on Brexit and international trade, it will definitely affect shipping, too. In post-Brexit, companies will face tougher customs regulations and export/import duties that they haven’t been liable to before. These controls will make the entire logistics process more time-consuming and expensive.
Even if you’re using one of Amazon’s fulfilment programmes, the problems associated with shipping to EU countries will still be inevitable. Delays at borders and extra taxes are only a few of the issues that may disadvantage your ecommerce business in post-Brexit.
How to prepare for Brexit?
The UK’s decision to leave the EU may hit your company hard, which is why you need to start getting prepared as soon as possible. In order to withstand the impact of Brexit on businesses and prevent your company from being trapped in a catch-22 situation, implement the following measures:
- Apply for Transitional Simplified Procedures. This will allow you to enjoy less complicated documentation processing and avoid unwanted delays when your goods are crossing the border.
- Set up an emergency fund. Allocating additional funds will help you handle eventualities and cover unexpected tariffs. Also, you will be able to revise your budget strategies to address the increasing needs of UK customers.
- Take advantage of fulfilment services. With new customs regulations down the road, e-tailers may have a hard time ensuring compliance. That is why you should turn to Minatus and use our fulfilment services. We will help you adapt to the upcoming changes so that you can seize all Brexit business opportunities and avoid being left out of borders.