For many retailers, Brexit plans were derailed at the onset of COVID-19. Now, with just one month to go before the deadline, brands and retailers are painfully aware that time is running out. eCommerce retailers who have been preparing for a massive increase in online demand this year just might be ahead of the curve in getting ready for Brexit.
The UK’s departure from the European Single Market is imminent. As we wait out the second wave lockdown amid the busiest shopping season of the year, retailers must also set about the critical task of preparing their business for Brexit without knowing exactly what the ramifications will be.
The UK Government has spent millions of pounds on communications regarding what businesses need to do in preparation for Brexit, yet a recent PFS survey of 150 UK-based retailers reveals many remain unprepared. Alarmingly, nearly a quarter (23%) recognize there will be implications to their business as a result of Brexit, but have yet to start preparing.
HMRC (Her Majesty’s Revenue and Customs department) is pleading with businesses to act and get the necessary contracts, processes and agreements in place to ensure your business is ready for the changes taking effect 1 January 2020, deal or no-deal. And yet, much of the delay around Brexit is directly related to ongoing confusion and uncertainty around the terms of departure. Case in point, as of late November, the Government had yet to test the vital IT systems being put in place, ready transit areas for lorries or resolve a substantial shortage of customs agents.
If your business is struggling to navigate all the uncertainty surrounding Brexit (among other things), you’re not alone. However, for eCommerce retailers and brands, the timing may have some unexpected benefits to kick starting your Brexit preparations.
Growing eCommerce volumes jumpstart Brexit preparedness
2020 is well on its way to shattering records in the eCommerce space. Digital shopping is expected to make up a third of all Christmas spending this year, with shoppers spending 25% more on eCommerce in 2020 compared to 2019. The systems and processes you put in place to manage these anticipated spikes may just be what saves you come mid-January, when the UK has officially made its EU exit.
If your customers are spread out across the UK and Europe, your ability to ensure cross-border supply chain continuity will be one of the major factors to keeping operations running smoothly post-Brexit. Likewise, when it comes to managing peak season volumes, it’s not just about capacity, the key is business continuity, especially during COVID, which is likely following us into 2021. Where your inventory is placed will have a significant impact on your ability to keep orders moving and meet consumer demands.
By dispersing inventory across the UK and mainland Europe and establishing multiple distribution points, you are able to bypass customs delays and carrier surcharges; two primary concerns surrounding Brexit. An advanced distributed order management (DOM) system will ensure your order management system (OMS) can divert orders to the appropriate inventory pool, depending on a number of factors, from delivery address to product type.
Brands selling primarily to customers in the UK are likely to see an uptick in UK-based retailer sales. Our recent survey found that 43% of retailers expect their UK customers to shop with more UK-based brands, encouraging brands and retailers to focus on building their UK customer base.
Untimely store closures during the peak shopping season this year have forced retailers to get creative about ways they can continue to meet consumer expectations in spite of the challenges. Spreading out your inventory across multiple locations and channels within the UK helps shorten delivery times or skip shipping altogether with alternative delivery methods.
With a mix of pop-up distribution centers, micro-fulfillment centers, and even brick-and-mortar stores turned ‘Dark Stores’, brands and retailers can effectively spread out inventory and get product closer to consumers for faster, cheaper and more sustainable delivery options.
The happy customer
With so much chaos and confusion around the transition, retailers need to be prepared for inevitable disruption and delays to their fulfilment process. That means prepping your customer service operations for increased volumes.
One third of retailers are anticipating an increase in customer complaints in Q1 of 2021 due to Brexit. Ramping customer service operations is likely already a priority for your peak preparations. The work you do now in preparing your support team will allow you to more smoothly enter Q1 and efficiently manage the expected volume increase.
As with the COVID response, we advise retailers to train agents to be appeasement-centric throughout the transition period. Provide additional empathy training to ensure frustrated customers feel that their complaints are heard. Disgruntled customers who are denied the opportunity to voice their complaints will often take to social media forums instead; make sure social monitoring is in place and act quickly to appease these customers and minimize potential long-term repercussions to your brand’s image. Handled effectively, this challenge can be turned into an opportunity to build customer loyalty long-term.
Keep Calm and Carry On
To say 2020 has been a challenge for retailers is something of an understatement at this point. This year has presented hurdle after hurdle and brands have had to quickly adapt and be flexible to keep business going. It is not over yet – one of the biggest challenges is yet to come with Brexit. However, the work you’ve done up to this point has not been in vain. Many of the changes you’ve implemented have likely helped you get ready for Brexit well.