Will the General Election Provide a New Direction for the Retail Industry?
Thursday 11th May 2017
Andy Brian, Head of Retail at Gordons, examines the BRC’s recommendations for the retail industry ahead of the General Election.
The snap General Election called by Prime Minister, Theresa May, has undoubtedly created opportunity among the uncertainty.
Representatives from all industries are setting out their aspirations and objectives ahead of the June 8 vote, and the retail sector is no different, with the British Retail Consortium (BRC) publishing its own recommendations for the next Government.
Entitled ‘Pioneers’, the report sets out the BRC’s perspective of the industry’s vision for a plan that not only promotes the interests of consumers in Brexit negotiations, but also supports a “pioneering, responsible and vibrant” future for the sector.
Putting consumers first
The subject of Brexit is addressed in detail, but most prominent is a request to put consumers first when negotiations occur, and to ensure that shoppers are protected from the potential cost of new tariffs.
The BRC also wants to see a transitional arrangement that recognises all goods in free circulation, and avoid what it refers to as a “cliff edge scenario”. Equally, it calls for assurances to the retail industry’s EU workforce and for the transfer of existing EU regulations into UK law to help provide certainty and continuity.
These actions would not only help to protect consumers, but also retailers, who like the rest of us have been peering out from under a shroud of uncertainty since the referendum result was announced last June. A personal view is that such assurances are highly unlikely to materialise, but as the BRC says, they would, if given, help create the foundations for future growth that retailers are hoping for.
The true cost of Brexit
Helen Dickinson, chief executive of the BRC, said recent work on UK trade imports spelled out the true cost to consumers’ food bills of exiting the EU without a deal and thus falling back on World Trade Organisation rules.
In order to help retailers keep prices low for consumers, the negotiations need to achieve “frictionless customs arrangements”, which provide certainty for EU colleagues working in the UK, and secure the continuity of existing EU legislation. This alludes to continued access for the UK to the single market, and all eyes will be on the next Government to see if that can be achieved.
The report also sets out a vision for the UK retail industry that establishes it as a pioneering sector adapting to a changing world.
This includes building a business tax environment that is “fit for purpose” in the 21st century and open neither to interpretation nor abuse, ensuring the integrity of businesses and their staff alike.
The next Government also needs to accelerate its investment in digital infrastructure and enable businesses to build the required skills for success on a more effective and efficient basis.
Another aim is to empower business responsibility and corporate governance, further boosting the sector’s integrity and setting out a framework for the pioneers of the future.
Negotiation and adaptation
Negotiating the UK’s future relationship with the EU will make it essential for policymakers to understand the “rapid change and testing conditions” that retail must operate in, according to the BRC.
As such, the UK will require policies that not only support economic growth, but a viable and rigid business tax environment.
As with every sector, the next Government will need to support retailers to innovate and invest in order to drive productivity, which will in turn benefit the communities in which retailers operate and the society in which retailers form a core component.
For retailers themselves, striking a balance between driving pace, navigating a new international trading environment and adapting to constantly evolving consumer demand will be a challenge, but businesses who are able to adapt when required will ultimately benefit.
If you need legal advice on any retail and supply chain matters please contact Andy on 0113 227 0354 or firstname.lastname@example.org. For more information about us please visit www.gordonsllp.com/sectors/retail-lawyers/.