“I think ultimately Brexit is affecting everybody, in one way or another,” lamented Topshop’s creative director Kate Phelan after the UK’s clinch decision to exit the European Union.
This sentiment is the bottom line, of course – but the question remains: to what extent? When, and how?
Borders are tightening, currencies are dipping, but the world spins on. We’re prepping our Christmas jumpers and gearing up for the winter rush, despite the looming uncertainty of our brisk departure.
Some questions will remain unanswered until a consensus is formed – across Parliament party lines and then across nations and borders – but the economic rumblings of the past months are the tea leaves that suggest the consequences of Brexit. Through these, we can predict some of the real-term effects that we’re at risk of facing.
Weaker Value Pound for Pound
One of the biggest factors driving Brexit anxiety is the dropping value of Sterling. A weaker value of the pound can lead to decreased consumer confidence, and in turn, a depreciation of profits for your business.
With every problem comes a silver lining, though. A weak Pound against a strong Euro could mean European buyers enjoy greater spending power at your store, driving up traffic and sales.
So long as trade to the continent remains relatively painless, of course…
Strict Trade Regulations
The UK’s exit from the Union naturally means that the benefits we enjoy from the customs union are entrenched in uncertainty.
Pending the notorious deals to be struck in the vestibules and conference rooms of the European Parliament, exports to Europe might be in for a rough time. Tariffs, tax and export costs threaten to diminish the value of cross-continent trade.
That silver lining’s still lingering around though – this time in the form of increased domestic interest. If imports become expensive and trade decreases from Europe, there’d be an uptick in domestic buyers.