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UK brands losing EU customers post-Brexit – even as direct sales rise post-Covid: study

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UK brands losing EU customers post-Brexit – even as direct sales rise post-Covid: study

Most UK brands that sell online say they have lost EU customers in the six months since the end of the Brexit transition period – with two thirds having lost a significant number, new research suggests.

 

Meanwhile, the CBI president, Lord Bilimoria, is calling on business and government to work together post-Brexit and Covid on issues from relaxing the UK Shortage Occupations List to widen access to jobs and to improve access to employment.

 

The Brexit effect: study

In a study, ChannelAdvisor and research company CensusWide questioned 304 CMOs at UK brands that sell online, and found that 94% said they had lost EU customers since December 31, with 66% having lost a significant number.

 

That’s likely to be because, say 73% of CMOs, Brexit has slowed the pace at which brands can deliver to EU customers, and 33% say that slowdown is significant. Looking ahead, however, most (91%) expect international sales to increase over the next 12 months – and 33% that they will do so significantly.

 

The Covid-19 effect

That’s likely related to the boom that brands have reported during Covid-19 lockdowns, according to the ChannelAdvisor study. Some 92% of brand CMOs say their brand has won significant numbers of new customers since the pandemic emerged, while 82% say direct sales are now higher than pre-Covid levels – with 27% significantly higher.

 

Vladi Shlesman, managing director, EMEA for ChannelAdvisor, says that if the Brexit disruption can be solved, brands will see their online sales grow strongly. He says: “UK brands are enjoying a phenomenal period of growth and will no doubt play an integral role in the country’s post-Covid recovery. However, the last few months of Brexit disruption have caused a significant headache for the vast majority of these firms, thanks to delays and complications at UK-EU customs.

 

"Brands rarely become ecommerce giants without strong international sales and finding a solution to this border disruption will benefit all sides. Leveraging expertise like a third-party logistics provider can overcome fulfilment challenges, or looking to new sources of demand could help plug the gap in demand. In the meantime, it’s inspiring to see that brands are enthused and confident about the coming year. After such a transformative time in the industry, I hope they continue to reap the rewards of ecommerce ”

 

CBI president Lord Bilimoria calls for action on employment post-Brexit

The CBI, meanwhile, is calling for government to add sectors such as logistics, hit by factors including the end of freedom of movement from the EU, to the UK Shortage Occupations List in order to enable migrant workers to fill vacancies. Pointing to the REC/KPMG report showing overall candidate availability during the last quarter, cross-bench peer and CBI president Lord Bilimoria said this week that candidate availability had fallen at its fastest rate since 2017.

 

Lord Bilimoria, president of the CBI, says: “It’s a big challenge, not just for individual businesses, who can’t find the people they need, but also for our longer-term economic recovery. We’ve got a perfect storm of factors coalescing. During the pandemic, many workers from overseas left the UK to return home – hitting the UK’s hospitality, logistics, and food processing industries particularly hard. The UK’s immigration system is also a barrier to hiring people from overseas to replace those who may have left.”

 

He also called on businesses to invest in innovation and technology, to open new routes into their businesses, and to consider employing those who might have previously been overlooked based on their gender, ethnicity or background.

 

And he said: “I never thought – as we come out the other side of the pandemic – I’d be giving a speech about staff shortages. Business and government together can solve this shortage. And if we do, I have every confidence this could be the best decade yet for the UK economy.”

 

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