The UK has managed to leave the Euro twice in a week after a very very disappointing match against the Vikings of Iceland.
What are the possible impacts of the Brexit vs the eCommerce players?
Here’s a quick sum up of what has happened shortly after the announcement of the UK cutting ties with Brussels:
- The £ has plunged to its lowest level since 1985 making this more expensive for British consumers purchasing online outside of the UK.
- David Cameron has resigned from 10 Downing Street.
- The England team has decided to follow its nations decision with the Euro 2016.
- England’s leave in the Euro 2016 is imminent whereas the UK will take over 2 years to depart from the EU zone.
- Over 3 million signatures for a second EU referendum on Britain’s EU membership.
Let’s look at the potential impacts this will have on eCommerce Websites:
- A negative effect for Foreign Retailers operating online and shipping to the UK as buyers will not be spending.
- EU citizens purchasing on UK sites because of the devaluation of the £ (would this be profitable in the long run for both Buyers and the UK retailers?).
- Marketplace vendors that are present on Amazon or eBay for example will eventually face difficulties in terms of costs but won’t stop them from buying and selling until future trade agreement talks.
- Special tariffs imposed for delivery shipments will be made for the UK like other countries that are in Euro zone such as Iceland, Switzerland and Norway.
eBay UK as also commented on Brexit with the following:
As a global business enabling cross-border trade for SMBs worldwide, eBay has been a consistent supporter of the EU Single Market and the creation of a true EU Digital Single Market.
We believe there are advantages for both sellers and buyers to be part of large open trade blocks. But our business is a global one and our sellers are successful within and outside the European Union. British voters have decided that their interests are best represented outside of the EU and so we will continue to put the best interests of British SMBs and customers at the heart of what we do.
We will continue to work with the UK Government and at a European level to ensure we are close to any discussions/changes resulting from this vote, which may affect our customers.
Amazon is also faced with complications with Britain’s exit. The company announced the expansion of 2 fulfilment centres providing 2500 secured jobs in the UK. However up to date, the eCommerce retailer has not released a statement regarding the impact Brexit will cause on them.
The other internet giant, Google is also said to be on hold at their development site in King’s Cross, for their new London offices if the UK leaves the EU. This could be a possible drawback for the UK economy if Google plans to relocate elsewhere in cities such as Paris & Berlin.
The main question we have to ask ourselves now is, whether a second referendum can take place or seek the idea whether London known as an International city for trades and businesses can become independent of the UK and be part of the EU.