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EDITORIAL Looking ahead to a time after Brexit… if you can imagine that

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If there was a theme of the week, this week’s would naturally be Brexit. While nothing is decided, the swirling uncertainty that surrounds what might play out in the next 106 days, or rather what we might wake up to on 30 March, is starting to move from the pages of analysts’ reports to the bottom lines of real world companies.

Results out this week from Dixons Carphone Warehouse and Superdry both cite the real and measurable fall in spending driven by consumer uncertainty. It isn’t the only reason that profits are slipping, but it isn’t helping.

These are real world numbers – real lost sales – that are the crystallisation of predictions among analysts that suggest that lower consumer confidence and inflated food prices would see the UK non-food retail sector £2.3 billon worse off in a hard Brexit scenario compared to a Brexit based on the Withdrawal Agreement, according to GlobalData’s Brexit and the Impact on Retail report.

But the real problem is that no one knows what is going to happen. Leadership turmoil, a deal that is non-negotiable, intransigent EU and UK politicians and an extremely factional approach to politics are all making it impossible for anyone – consumers and retailers – to work out what they should do.

As the Carphone and Superdry results show, not knowing is stopping consumers spending. Equally, this lack of confidence in what shoppers will do is leading to retailers themselves not having the confidence to invest and change.

Aside from the headline-grabbing Brexit shenanigans, both Dixon’s and Superdry’s results also point to how they are failing to join the dots of online and mobile with their existing and more traditional in-store retail outlets.

To be fair to both these retailers, they have overhaul plans in place – Superdry working it elements of its for four years – to improve how both use online and mobile to drive sales. Focussing on how to connect with shoppers is key and these two huge retailers are late to the party, but at the party they now are.

Using technology is going to be the only way to drive up sales: simply because it is what shoppers want. Brexit seems to be going on for ever – and there is no guarantee that it will be done by 29 March 2019 – but it isn’t the only game in town. There will be a time after Brexit and it is a time that retailers should perhaps be focussing on right now.

Shoppers will get their nerve back and they will want to buy: and retailers need to be ready to serve them.

Just look at rural department store Harts of Stur. It has combined its heritage and established store reach across the West Country with online to drive growth through mobile. In fact, it has seen a 36% increase in sales over eight weeks compared to the same period last year alongside a 28% rise in transactions via mobile. The retailer has also seen mobile conversion rates rise by almost 4% by revamping its online and mobile presence.

Here lies an object lesson in how to combine what works in both the real and online worlds. It is something that Carphone and Superdry are looking to do – and it isn’t easy and it isn’t cheap – but it is essential. And it is coming. Brexit or no.

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