BREXIT

Despite another extension agreed upon today by UK Prime Minister Johnson and European Commission President Ursula von der Leyen, the chances of a final deal appear very low.

Both sides are still far apart on several key points and have tasked their negotiators to continue talking “to see whether an agreement can even at this late stage be reached.”

Last week, both Johnson had von der Leyen had set Sunday as the deadline, but as with so many deadlines before this one, it has been extended again.

If no deal is reached in the coming days, the hard deadline of December 31 will mean that the UK and the EU will have no trade deal and the UK and the EU member countries will trade according to World Trade Organization (WTO) rules.

Whilst many UK companies have been preparing for a hard BREXIT, the COVID pandemic and its lockdown rules across the UK and Europe have brought additional challenges to this situation.

Long lorry queues at the Port of Dover already show a desperate last-ditch effort by British industry to bring as many supplies into the country before January 1.

The Sunday Times reported that supermarkets have been told to stockpile food as shortages of food, especially vegetables, could last at least three months. UK health ministers have urged medical suppliers to stock up too.

Even normal Christmas shopping has been disrupted with shortages reported among toys and other popular gift items due to challenges bringing more inventory into the country.

Some emergency planners predict that if there is no BREXIT deal within the next few days, panic-buying could reach a scale dwarfing the first wave of the COVID crisis.

London, UK – March 19, 2020: Empty shelves in still water aisle of Morrisons supermarket in Palmers Green, London, as people stock up due to Coronavirus threat.

Impact on SMEs

Even with a BREXIT deal, some experts warned of supply line challenges. But without a BREXIT deal, the situation will be far worse and could impact global shipments, not just shipments from the EU.

Whilst the UK government has been working on plans for a no BEXIT deal, no one knows what to really expect, especially with the second round of COVID restrictions and lockdowns impacting both the UK and the EU.

The double crisis of BREXIT and COVID is the worst case scenario for UK SMEs. Many online businesses and retailers were able to stock up for the busy Christmas season, but what happens after that is anyone’s guess.

Popular marketplace Wish recently told its customers, “Our goal at Wish is to ensure the shopping experience remains enjoyable and affordable for our customers. When more details are shared with us, we will update you promptly,” emphasising how cloudy the crystal ball is for UK businesses.

In addition, UK businesses with EU customers will face new export rules and EU customers may be less willing to buy from UK businesses, fearing products will be delayed or slapped with import taxes. This combination is not good for sales either.

With all the uncertainty, https://eseller365.com co-Founder Dave Furness summed it up best, “January will be a s#it show.”

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