Blis | Brexit: brands and consumers brace for tough winter

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Brexit: brands and consumers brace for tough winter

A significant proportion of British shoppers are anticipating supply problems as a consequence of October’s slated date for Brexit, while retailers are warning an autumn exit would hit them at the busiest time of the year.

Regardless of employment status, 43% of Brits say their shopping habits will be affected by Brexit, with over half of those (55%) citing ‘less disposable income’ as a specific impact.

As many as 40% of those concerned about post-Brexit shopping have started stockpiling items they believe will be in short supply after 31 October, according to a report by the intelligence firm Blis. Part of a broader EMEA survey, the report is based on interviews with 4,681 consumers, 1,057 of those based in the UK. Understandably, the most commonly stockpiled category is food (56%), followed by household items (44%) and medicine (37%).

At the level of business, the timing of the exit date at the end of October coincides with UK retail’s preparation for its busiest season, comprising Halloween, Black Friday, and the crucial Christmas holiday period.

With just under four months to go, the political conversation has taken an especially hard line, as both contenders to become the UK’s next prime minister, Jeremy Hunt and Boris Johnson, say they’re intent on leaving with no withdrawal deal with the EU if a renegotiation doesn’t take place. The European Union has reiterated its position, however, that the deal on the table is the only deal available. It’s a case of who blinks first.

But political posturing and the knotty realities of supply chain management are causing a persistent headache for UK retail.

“You couldn’t pick a worse date,” said Sainsbury’s CEO Mike Coupe in comments reported by Bloomberg. “A very hard-edged Brexit would be very disruptive to our business and potentially disruptive to people’s Christmases.”

The problem boils down to warehouse space and sheer network bandwidth. At the end of October, the level of stock held by British retailers in anticipation of the busy Christmas season swells. Add to this extra stock to avoid post-Brexit supply chain chaos, and the systems are pushed into an uncomfortable position.

“If there’s a problem at the border, if there’s a problem with tariffs, there could be interruptions,” said Tesco CEO, Dave Lewis.

The saga has dragged on in not particularly interesting ways. Fatigue is draining on the individuals within businesses tasked with preparing for Brexit.

“People that ramped down their no-deal planning at the end of March are struggling to get it going again”, Brian Connell, a supply chain consultant at KPMG told Bloomberg. “It’s difficult to maintain that level of energy and commitment.”

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