Brexit: What’s grocery got to do with it?
21 June 2016
Tomorrow could make history as the long awaited and much talked about debate to stay or leave the European Union takes place. With latest polls suggesting a seemingly even split between the remain and leave campaigns the future of Britain and the EU is at present a hard one to decipher.
As exports and imports act as a fundamental element of Britain’s relationship with the EU, we have been looking into what the vote leave campaign prevailing could mean for the UK grocery sector. We polled shoppers to see what affect they believed leaving the EU would have on the price of food and drink. 35% believe prices will increase compared to 13% that believe it will decrease suggesting that shoppers recognise a level of dependence on exports from outside of the UK for food and drink.
However would it be retailers that would become the beneficiaries of the perceived price increase of food and drink by exiting the EU? We surveyed over 500 employees in a variety of roles in the sector, from farmers to forecourt retailers to find out how they believed Brexit would impact the growth of their business. Only 9% said that it would increase the growth whilst 22% said it would decrease suggesting that both shoppers and retailers believe Brexit would mean a knock to pricing.
In the same survey we asked how they believed the UK leaving the EU would impact in terms of red tape, 32% said it would reduce red tape a lot. Red tape has been an annoyance to the grocery sector for some years, one that the majority appear to put down to the EU.
The torn perception amongst grocery sector professionals begs the question of how leaving the EU would go on to affect how the wholesale and convenience sector operates. As we continually see price being one of the most important factor for retailers, could an increase in costs in an already competitive industry see retailers seek new route to markets, or in turn lead wholesalers to consider their current model and seek new and innovative ways to reach their current customers and target new ones.
The latest developments in foodservice such as UberEATS and Amazon Fresh in grocery show how the market are quick to adapt and be innovative in an ever changing market where people are constantly looking for something new. These brand diversifications are distinguishable yet do not require complex new structures and can operate within their pre-existing frameworks meaning the effects of Brexit may see the rise of even more creative business ventures in even more corners of the market.
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