When it comes to “shocks”, Brexit is like no other. Other situations surrounded by uncertainty – like the 1973 OPEC oil price shock or horrific terrorist attacks – create an immediate surge of uncertainty that quickly subsides and is replaced with a path forward. Brexit, on the other hand, has been very, very different.
Already over three years ago, uncertainty arose after the UK voted to leave the European Union in June 2016. Since then, that uncertainty has continued. If anything, it has grown with each passing month and each deadline that is missed. Businesses have especially been affected. There is not only uncertainty over what the terms of the deal might be, but also what the UK’s long-term relationship with the EU will look like.
Other questions businesses are asking include, how will the UK transition to the end state? What does it mean for market access? How will the availability of migrant labor and production regulation be impacted?
What Brexit means for the average ecommerce retailer
For UK-based merchants, rest assured, it is unlikely that the products you can and cannot import will change in the short-term. Large companies and suppliers that import goods could be affected by increases in tariffs, but this should not affect small and midsize merchants. Here are three areas of business you should be aware of and stay up-to-date on:
It is possible that manufacturers and distributors might no longer be constrained and belong to a single market. This could lead manufacturers and distributors to create territory licenses and limitations as to who can sell in the UK and the EU (currently illegal du to the Treaty of Lisbon). Ultimately, this could alter the sales terms that ecommerce retailers receive from suppliers.
Value-added tax (VAT)
If the UK does leave the EU with no deal, that would mean EU and UK businesses no longer have to collect VAT for sales to consumers in each locale. The customer may still be charged VAT on the point of import, but it would be levied by the importer – not the retailer.
Due to all that is being reported in the media, it could scare UK and EU consumers into buying locally rather than internationally. This would create new opportunities for ecommerce merchants selling to patriotic consumers.
Only time can tell what is certain about Brexit and all of its uncertainty. For now, the best thing merchants can do is to research how they can prepare and stay informed on the latest Brexit news. For more on Brexit and merchant services (like worldpay customer services), checkout the latest information and reviews at Best Payment Providers.
Author Bio: Payment industry expert Taylor Cole is a passionate merchant account expert who understands the complicated world of accepting credit and debit cards at your business. His understanding of the industry and worldpay customer reviews has helped thousands of business owners save money and time.