Brexit consequences: “The UK is still the top choice for ecommerce in Europe”

James Hyde on Brexit consequencesJames and James Fulfilment’s James Hyde on Brexit consequences, the UK’s ecommerce strength and the how this might all affect EU regulations.

The Brexit vote has cause a lot of uncertainty in the business world, and there are plenty of questions to be answered, but it won’t have any significant effect on trade. In fact, the UK is still the top choice for ecommerce fulfilment and remains the largest market for online shopping in Europe.

Here’s why:

  • The United Kingdom will remain an excellent choice as a gateway to Europe and will continue to enjoy free trade.
  • The UK is the largest ecommerce market in Europe at £52 billion, nearly twice the size of France.
  • The UK is currently the world leader in ecommerce accounting for 14.5% of all purchases.
  • Britain has the highest spend per online shopper within Europe.
  • The UK is an English language market, so requires minimal product labelling changes.

The referendum: See EU later?

A sign showing the EU flag and Britain leaving, triggering brexit consequences

When the public voted in the recent referendum for the UK to leave the EU, they voted without any specific plan or model before them as to what the future might look like. While that has clearly created a lot of uncertainty, both in the financial markets and in business as a whole, the reality is likely to be far from a hard-and-fast EU exit.

It’s also worth noting that the result itself is not legally binding—there is already talk of a second referendum, suggestions that Scotland could veto the exit, and discussion as to whether parliament will simply ignore the vote (though that’s not to say we mustn’t consider the potential effects).

There is currently a lot of division within the UK over immigration and our sovereignty, fuelled over the last decade not only by the media, but also by the government itself. EU regulations and immigration have been popular excuses for the underinvestment in schools, the failings of the NHS, pensions and economic recession.

Many are suggesting that the referendum result is more of a ‘vote of no confidence’ in the system, more of a retaliation against the establishments of both the Government and Brussels than it is a desire to actually remove the UK from the European Union. It must be remembered that the majority of the population (leave voters were 37.4% of total electorate; 27% of UK population) either didn’t vote or didn’t vote to leave.

What does this mean for the ability of the UK to ship goods to Europe?

Tower bridge

While a much of the UK population is unhappy with the current state of EU integration, there is little doubt that the UK will still remain part of the European Single Market, as to leave would be hugely costly for the country. For UK businesses to continue to trade in Europe they would be required continue to abide by EU regulations.

That means that although the UK may no longer play a part in the creation of regulations, it would still be subject to them. Many of those campaigning for the UK to leave entirely have since back-tracked on their promises in acknowledgement that it wouldn’t actually be possible to leave entirely.

The Europe Union is also a lot more complex than many realise, and is made up of multiple agreements working at different levels to create a more open market. For instance, there’s the European Free Trade Area (EFTA), the European Economic Area (EEA), the European Union Customs Union (CU), Association Agreements (AAs and SAAs), as well as country-specific treaties for trade.

So whilst the UK may leave the EU, it would remain part of the EFTA, EEA and CU. There would continue to be free trade in a single market, without customs duties or levies as there is now. If the UK remains, which is still a possibility, then it would make no difference of course.

James Hyde is Founder and Operations Director of James and James Fulfilment – www.ecommercefulfilment.com

James Hyde

James Hyde

Operations Director, James and James Fulfilment

James Hyde read Manufacturing Engineering and Management at the University Cambridge. When James looked at logistics 5 years ago, he saw an industry in trouble: Inefficiencies everywhere – warehouses running on technology decades old. He saw an industry that was struggling to keep up with the advances in web technology and the expectations of the modern-age multi-channel retailer and he didn’t like it, so with his fellow director James Strachan they are fixing fulfilment.

James and James Fulfilment provides pick and pack services to growing online retailers. They have a network of warehouses around the world and a web based fulfilment system that is not only capable of interacting with multi-channel retail platforms in real time, but is flexible, reliable and provides an integrated e-fulfilment service normally only affordable to very big business.

June 27, 2016

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