How Will Brexit Affect UK Sellers?

Britain will leave the European Union on March 29th, 2019, at 11 p.m. (GMT).

• Importing to the United Kingdom could become more complex and expensive.
• The British Pound (GBP) is at an all-time low.
• Sellers could see a surge in sales before the end of March.
• There are two Brexit options: soft Brexit or hard Brexit.
• Amazon emailed UK sellers to say that a no-deal “may temporarily prevent cross-border trade”.

Britain is leaving the EU.

On March 29th, 2019, Britain will leave the European Union. But even after voting to exit the EU during the June, 2016, referendum, people still have questions about the impending withdrawal from Europe.

The most important question we have is: how will this affect Amazon UK Sellers?

How will Brexit affect UK Sellers?

At this point, it’s unclear as to how Amazon sellers will be affected. And because no details are set in stone for exiting the EU, speculating what the future holds is tough.

However, if we want to be at least somewhat prepared for the 29th of March, then we need to look at what we know for sure. That will give us an idea of what could happen.

So, first, we know that the GBP is at it’s lowest value in 31 years. That could mean increased import fees for UK sellers. But, even with a weaker pound, this doesn’t mean all is lost. It could actually have a positive effect on sales.

Non-UK European customers will likely take advantage of the GBP’s current state by buying products from amazon.co.uk. Therefore, Amazon UK should see an increase in sales conversions, at least until Brexit goes through.

Second, we know that there are two exit options on the table: soft Brexit and hard Brexit.

What does ‘soft Brexit’ mean?

A ‘soft Brexit’ means that the United Kingdom would keep certain EU rules in place. And two of the rules that would remain are the trading and border rules.

Thankfully, by keeping those EU rules, the process for importing and exporting goods would remain the same. Especially nice is the fact that a soft Brexit would mean that Britain would stay a member of the EU’s customs union. For that reason, UK exports would not be subject to border checks.

A soft Brexit also means that Britain would still have access to the European Single Market, by being a part of the European Economic Area (EEA).

EEA countries have to make payments into the EU’s budget, to allow for goods, services, capital and people to move freely across European borders. So, Amazon UK sellers wouldn’t need to worry about importing stock from other countries (such as China), as they wouldn’t be faced with higher fees or tighter regulations.

It could also mean that the GBP could increase in value. When working with international companies, that would be extremely beneficial. It could lead to higher conversion rates.

Ultimately, if the UK goes for the soft Brexit, not much will change for Amazon UK sellers who sell in the UK and across Europe.

And ‘Hard Brexit’?

Just as it sounds, hard Brexit is soft Brexit’s polar opposite. A hard Brexit means that the United Kingdom will sever all ties with Europe, including its trade laws.

This could be problematic for Amazon UK sellers who use the European Fulfilment Network (EFN) . With EFN, a seller’s stock is held in an Amazon UK fulfillment center. From there, it can be shipped to one of the other European marketplaces. But, if hard Brexit is a go, shipping to France, Germany, Italy and Spain could mean paying additional taxes.

Products being imported into the UK might be taxed at a higher rate as well.

In a case like this, it’s tempting to cover the additional fees by passing them onto customers. However, that tactic could have a negative impact on sales. The likely delay in shipping, should we find ourselves in a hard Brexit scenario, could also result fewer conversions.

If a hard Brexit comes to pass, it’s imperative to update your customers with their order status, and when they can expect them to be delivered. Customers are happier when they know what’s going on, so being prepared and keeping your customers informed will help you survive a hard Brexit.

What about a ‘no-deal’?

The UK government has said that a no-deal Brexit may disrupt borders temporarily. This would have a tremendous impact on the movement of goods between the UK and other European countries.

Thankfully, however, the UK government stated that the possibility of a ‘no-deal’ outcome is unlikely.

Okay, so what’s the bottom line?

In a nutshell, as Amazon sellers, we don’t have too much to worry about, regardless of how the UK decides to leave the European Union.

Sure, we may incur some extra shipping and import fees if we’re selling and shipping outside of the UK.  And there’s a chance we’ll have to deal with delayed shipping and new regulations. But, by preparing for either outcome, we’re ahead of the game.

So stay up to date with any and all Brexit news. You want to ensure that you are the first to know when a Brexit strategy has been confirmed.  That way you can react quickly, pulling together your own Brexit plan. This means looking at your financials, to see if you can afford the additional fees, and preparing email campaigns in advance, to keep customers up to date with their shipments.

Finally, don’t panic.

Being a Brit myself, I would love to know what the future holds for Britain after Brexit. Right now though, we’re all in the dark. Only time will tell what Brexit has in store for us.

And regardless of whether we’re handed a soft or hard Brexit, it shouldn’t be a game-changer for UK sellers (FBA sellers in particular). As long as we are prepared, we should be able to come out the other side only slightly worse for wear.

Who knows? We might even become better sellers after all of this!