5 Ways Brexit Could Impact Your Online Business
Published on 20th August 2019
The UK is due to leave the European Union on 31st October 2019, but despite months of speculation and discussion, the whole situation remains shrouded in uncertainty.
Whether we leave the EU with a deal or not, one thing is for certain – Brexit means big changes for UK businesses.
As negotiations continue, it’s becoming clearer and clearer just how many aspects of online business could be at stake following Britain’s withdrawal from the EU.
Whilst we can’t know for certain what exactly will change, here’s a look at the 5 ways Brexit is expected to impact online businesses in the UK:
1. European domain names may no longer be available
Once the UK leaves the EU, UK businesses will no longer be eligible to hold domain names ending in the .eu extension – e.g. www.mywebsite.eu. These are typically used by websites with a continental reach, such as ecommerce stores selling across Europe.
This is because this domain extension – or top-level domain – is only available to website owners within the EU, Norway, Iceland, or Liechtenstein – the European Economic Area.
Brexit won’t just affect businesses trying to register a new website with an .eu domain – it will also affect the 1000s of UK businesses who already have a .eu website.
A loss of eligibility means that websites and email addresses will no longer function on these domains, which could have serious consequences for anyone without an alternative domain name already set up.
If we leave the European Union without a deal, these consequences will be felt immediately. Even with a planned transition period, the outcome will ultimately be the same.
It’s therefore recommended that any UK businesses with an existing .eu domain name move to a non .eu web address as soon as possible to minimise potential inconvenience for both your business and your customers.
It’s also worth bearing in mind that it may not just be .eu domain names that are affected – any European extension, such as .fr, .de, or .it, could also cause problems for businesses registered in the UK come 1st November 2019.
2. Data protection laws could all change again
It’s not just Brexit that’s been causing a headache for UK businesses lately. In May 2018, GDPR – the EU’s magnum opus on data privacy – came into force, leaving many companies scrambling to ensure their business was legally compliant.
Well, just as the dust was starting to settle from the initial GDPR panic, it looks like the laws could all be set to change again.
Deal or no deal, it’s likely that the UK will retain the EU’s data privacy laws for a while. Over time however, the government could choose to adopt different legislation, resulting in more regulations for businesses to comply with.
Of course, this could have wider implications for businesses who are regularly trading within the EU, as they may find themselves having to abide by two sets of privacy laws at the same time in order to do business with European customers.
What’s more, this could also create problems for UK companies who are not using UK based services.
If the UK government were to implement stricter regulations than those put in place by the EU, this would cause serious complications for anyone relying on web servers or data centres outside of Britain, for example.
3. Marketing services may start to cost more
Ever since Britain voted to leave the European Union on 23rd June 2016, the pound has experienced serious fluctuation, with the currency declining sharply in value at several key points during negotiations.
When the UK leaves the EU, we can expect to see the pound fall again, especially in the case of a hard Brexit.
"When the UK leaves the EU, we can expect to see the pound fall again"
With foreign currencies so much stronger against the pound, this may have an impact on operational costs for UK businesses, especially in the case of online marketing services.
Many popular platforms and tools, such as MailChimp, are billed in US dollars, so marketing budgets will need to be adjusted to accommodate the extra costs caused by the low exchange rate.
It won’t just be marketing services which are affected by the falling pound – UK businesses with websites hosted on servers based in other countries could also experience higher expenditure to keep their businesses online.
4. Ecommerce websites could see a rise in sales
The good news is, it may not be all doom and gloom for online retailers, even in the face of the falling pound.
The reason for this is that as our currency tumbles, British goods become increasingly better value for money for international shoppers.
Therefore, businesses with ecommerce websites may find that Brexit actually has a positive effect on their sales as they gain new customers abroad.
In light of this, UK businesses would do well to prepare for a possible uptick in global sales by ensuring their websites are equipped with the necessary translation tools.
They should also be set up to accept payments in multiple currencies, with plenty of international delivery options available too.
Brexit could also result in more ecommerce sales from UK customers as people start to look closer to home when making online purchases.
With the possibility of more tariffs and hidden costs in the aftermath of Brexit, shoppers who are used to buying from European and American websites will be more inclined to buy from UK retailers, especially as the weakening pound will also mean their money doesn’t go nearly as far.
This is also likely to mean that customers start to display savvier shopping habits, with people shopping around more than ever in search of the best deals.
To take advantage of post-Brexit shopping behaviours, it’s worth keeping your prices competitive and introducing discounts and deals into your marketing plans.
Don’t forget that providing a brilliant customer experience is crucial, especially if you want to keep shoppers coming back, so now is also a great time to look at your existing website and ensure it’s still looking professional and working brilliantly.
5. Shipping costs might increase significantly
Something that could hinder the success of UK businesses selling to European customers is the huge increase in international shipping costs that we’re likely to see post-Brexit.
Whilst nothing is set in stone, it’s possible that British companies will suddenly have to start paying taxes in order to send items to mainland Europe.
This presents a challenge to businesses, as with shipping costs increasing so dramatically, they must choose whether to pass these price increases on to the customer or to cover them themselves.
Many businesses simply won’t be able to absorb the extra shipping costs themselves, but this could in turn hurt their sales, as many European shoppers are likely to be put off by higher delivery rates.
Those that do try to keep shipping costs low for customers may not lose out on sales, but will still take a hit to profits.
The best course of action may be to focus online marketing efforts on attracting more UK customers once Brexit has taken place, and redoubling efforts to increase sales from EU customers before these changes come into force.
How will Brexit affect it’seeze websites?
It’s hard to know what exactly will change for online businesses when Britain eventually leaves the European Union, but with an it’seeze website you can rest assured that your online presence is in safe hands.
Every website we create is professionally designed and easy to use, so your customers will always enjoy a great user experience, and because our websites are hosted exclusively on secure UK based servers, you won’t have to worry about increased costs as a result of Brexit.
Our ecommerce website package offers easy shop management, and provides online retailers with plenty of options to set up different delivery rates, accept various currencies, and create special offers, so you’ll have no difficulty adjusting your online shop to accommodate any post-Brexit marketing strategies.
As a web design company that takes privacy and security very seriously, we made sure to put a number of measures in place last year to help our clients achieve GDPR compliance, and we continue to monitor matters of data privacy and make changes accordingly to ensure it’seeze websites are always one step ahead.
In the event that Brexit does lead to new rules regarding online security, businesses with it’seeze websites can be sure that they’ll be the first to know when anything changes.
Truly, the only thing we know for sure about the impact of Brexit on online businesses is that there is bound to be major upheaval, but until Britain finally exits the European Union, we can’t say for certain what these changes will be.
Although it’s difficult to plan ahead when so much is unknown, having a plan in place is definitely the best strategy.
Making sure your online presence is up to scratch well in advance of Brexit should be a key consideration, and at it’seeze we pride ourselves on providing UK businesses with fantastic websites that really make a difference.
To find out how we can help, get in touch with our friendly team today.
Tagged as: Brexit, ecommerce, GDPR, online business
Share this post: