Brexit Effect on Irish Consumers

Tim76

Does anybody have any ideas how Brexit and increased trade tariffs will affect British chains such as Tesco, Boots, Debenhams etc. operating in Ireland?

Can we expect to see an increase in prices across the board for all products stocked in these stores from the UK? Or will they just pull out altogether?

Also, how will online sales be affected? The likes of Amazon is UK based as well as a many other online retailers...

L1011

Crystal ball job here - we've no idea what's going to happen. Its very possible that a "hard brexit" can't pass parliament; there are sufficient Tories to revolt and they also don't have a majority in the Lords who could delay a bill quite some time.

My guesses would be that, if they do leave the customs union, some weaker UK chains may leave. Bigger ones won't - many of them deal in countries outside the EU as it stands. Product lineups may change - but lots of what we consider UK brands are either made here already (some Cadbury stuff) or not in the UK (Unilever products made in Holland, more Cadbury stuff made in Poland, etc, etc).

One thing that is almost inevitable is that small shops selling UK market products - Northern Irish milk/bread, GB imported own brands etc - will change back to Irish suppliers.

Online sales in the event of no customs union - will be the same as buying from the US or China as many people already do. Low-ish limit below which VAT and duty aren't charged. Will be paying ex-VAT prices to the UK retailer, though.

Nody

Amazon is likely to redirect customers to their European once to save the duty to be fair and bulk up their European warehouses to handle the volumes instead. As for UK stores they will remain here as long as it's profitable and that will mainly comes down to where things are manufactured and how much the paperwork will cost; if they try to raise their prices however the like of Lidl and Aldi have no such cost increase and will happily take their customers.

ytpe2r5bxkn0c1

To be honest, nobody knows anything yet. It's all supposition at this point.

Tim76

Agreed, that we're in crystal ball territory here. However, as a hard Brexit seems more and more likely by the day I think the potential for the market here to be drastically shook up seems all the more probable.

The exodus of UK stores and brands can only be bad news for the consumer and result in lack of choice and competition. Perhaps continental brands such as Carrefour might step in to the void but who knows.

As for getting online goods delivered from the continent, surely this can only lead to increased delivery costs.

All in all, i think Brexit is going to be very bad news for the Irish consumer, at least in the short term.

Samuel T. Cogley

I don't think we'll see too much of an exodus of stores (unless there is a huge hit to the Anglo-Irish economy which is possible). That's actually bad news in a way. We're still heavily linked with the UK. Prices in the UK could increase drastically and we're then faced with the same increases. The rest of the Eurozone are dealing primarily in the Euro, it seems to me we deal in the Euro through sterling as many of our goods land in the UK first.

I welcome correction here as frankly it's something that scares me a wee bit.

L1011

Libertarian Kant wrote: »

The rest of the Eurozone are dealing primarily in the Euro, it seems to me we deal in the Euro through sterling as many of our goods land in the UK first.

In some cases this is because the Irish distributor for a product is a price racking gombeen* and its actually cheaper to us the UK one with two currency conversions in the way.

In a relatively niche industry I worked in I knew of one such distributor who lost far more money by trade avoiding him than he ever made from his ridiculous margins.

*the real meaning rather than the insult, basically

ohnonotgmail

L1011 wrote: »

Crystal ball job here - we've no idea what's going to happen. Its very possible that a "hard brexit" can't pass parliament; there are sufficient Tories to revolt and they also don't have a majority in the Lords who could delay a bill quite some time.

My guesses would be that, if they do leave the customs union, some weaker UK chains may leave. Bigger ones won't - many of them deal in countries outside the EU as it stands. Product lineups may change - but lots of what we consider UK brands are either made here already (some Cadbury stuff) or not in the UK (Unilever products made in Holland, more Cadbury stuff made in Poland, etc, etc).

One thing that is almost inevitable is that small shops selling UK market products - Northern Irish milk/bread, GB imported own brands etc - will change back to Irish suppliers.

Online sales in the event of no customs union - will be the same as buying from the US or China as many people already do. Low-ish limit below which VAT and duty aren't charged. Will be paying ex-VAT prices to the UK retailer, though.

Is it not more like that they will just charge at the UK vat rate and remit the money to HMRC instead of charging Irish vat rate and remitting the money to the revenue commisioners here?

L1011

ohnonotgmail wrote: »

Is it not more like that they will just charge at the UK vat rate and remit the money to HMRC instead of charging Irish vat rate and remitting the money to the revenue commisioners here?

No. Sale won't be VAT liable in the UK in this scenario

ytpe2r5bxkn0c1

ohnonotgmail wrote: »

Is it not more like that they will just charge at the UK vat rate and remit the money to HMRC instead of charging Irish vat rate and remitting the money to the revenue commisioners here?

Not if they end up out of the common trading area. VAT plus duty would be applied on entering Ireland.

ED E

I could see Amazon selling to us via .de/.fr (Now with English modes) and using Dublin/Louth as dispatch points where orders come in bulk to there and are taken by AnPost onwards. Probably add a day to delivery times.

Del2005

ED E wrote: »

I could see Amazon selling to us via .de/.fr (Now with English modes) and using Dublin/Louth as dispatch points where orders come in bulk to there and are taken by AnPost onwards. Probably add a day to delivery times.

Amazon have bought the old Caburys factory in Tallaght and are doing a lot of work there. No idea if it'll be a distribution centre or offices.
Even if they do setup a .ie site knowing the way companies work it'll probably still be cheaper to buy from their other sites.

L1011

Del2005 wrote: »

No idea if it'll be a distribution centre or offices.

Neither. Data centre. Lovely cold air makes Ireland very suitable for modern data centres that use hot aisle containment and slightly warmer cold area temperatures.

Its going to be mostly for AWS which is where Amazon make their real money.