The British Retail Consortium has highlighted five challenges that remain for retailers in the UK.
It comes with five months left before the UK leaves the current economic structures.
In preparation for what is to come, the BRC held its first Trade Community Call exclusively to give Associate Members the inside track on the latest Brexit developments.
Associate Members heard from and put their questions direct to food and sustainability director, Andrew Opie, director of the Northern Ireland British Retail Consortium, Aodhan Conolly, and Trade Policy expert, William Bain on retailers’ preparedness as the clock ticks down to January 1.
The BRC was able to share unique insight into the current position of the UK Government and the EU from regular meetings with No. 10, BEIS, Defra, the NI Office and connections in Brussels.
The likelihood of striking a deal by the Autumn is somewhat in the balance with some key issues – for example on fisheries and State Aid – still needing accommodation on both sides.
The longer it takes to get agreement on these key issues, the less time there is to address outstanding issues such as labelling and compliance on imports and exports, the bigger impact it will have on UK retailers.
The BRC explained that these discussions cannot be left to the last minute and said it must see progressive agreement week by week, in the eight weeks remaining in the process.
The five key challenges for UK retailers, outlined by the BRC are:
No deal on tariffs
More red tape, with considerable and costly new requirements on customs declarations
Friction at the NI border – even with easements and concessions it will cost more to transport goods from NI to GB
Lack of time to prepare for the wide-ranging changes with incomplete guidance
Capacity – a challenge for retailers of all sizes who are dealing with the ongoing fallout from COVID19
Looking at Northern Ireland specifically, the BRC was able to give the latest insight from its recent meeting with Michael Gove on new announcements and developments including the TSS scheme, financial support for GB/NI business, and the new ‘supermarket solution.’
It outlined: “Our member intel tells us we could be heading for a perfect storm in Northern Ireland. Northern Ireland is vulnerable to the economic shocks caused by COVID, with more volatile footfall, greater reduction in consumer spend during times of recession and squeeze on profitability.
“It’s a very simple equation – if additional costs caused by Brexit outweigh profit margins, either the product or the business model becomes unviable.”
Adding: “Brexit is a large and complex jigsaw and we need all the pieces in place for retailers to be able to properly prepare for and guard themselves against the shocks to come, particularly in Northern Ireland.”