Impact of Brexit on Retail industry of United Kingdom

EC4006 – Fundamentals of
Economics

Contents
ESSAY TOPIC................................................................................................................................1
ESSAY MAIN BODY.....................................................................................................................1
Introduction..................................................................................................................................1
Main body....................................................................................................................................1
Conclusion...................................................................................................................................6
REFERENCES................................................................................................................................8

ESSAY TOPIC
“Impact of Brexit on Retail industry of United Kingdom”
ESSAY MAIN BODY
Introduction
Brexit is a referendum in which United Kingdom decided to leave European Union. This
concept of British exit has split the relations between UK and entire European Union. This
concept has changed the trade, security and migration relationship between these two regions
(Bloom and et.al., 2019). Due to BREXIT, almost every industry has suffered and the main
causes behind this suffering are higher exchange rates and transportation costs. In this essay,
impact of BREXIT is analysed upon Retail sector. Retail industry is highly dependent upon
supply chain and logistics, and due to high transportation costs and taxes, organisations has to
pay high costs to procure goods from other countries of Europe.
Main body
Retail industry is a wider term which is used for the retail services of products. These
products include groceries, home appliances, motor vehicles and many more. This industry is
highly impacted by the concept of BREXIT due to various reasons. These reasons are classified
below as the key areas in retail industry which has been impacted due to BREXIT.
The first area in retail industry which has been impacted is Access of Labour. The industry of
retailing does not include any manufacturing or production. Organisations in this industry
procure products from manufacturers and then sell to their end users. In this process, the most
important key which is the reason of retail industry success is labour. Labourers are used by
retail organisations to convene and assist customers about their purchase. United Kingdom is a
developed country, due to which their labour is expensive. Before the commencement of
BREXIT, the retail organisations use to procure labours from various countries of Europe
(Vajpayee and Sarder, 2019).
According to Jeremy Cooper (2018), the retail industry employs around 300 000 labourers
who belong of Europe. These workers are still in United Kingdom only but they are unlikely to
stay in UK for large period of time (Implications of Brexit on the UK retail industry, 2018). The
retail companies of UK such as Tesco, Walmart, Sainsbury’s and many others employs EU
workers. Due to the commencement of BREXIT, these companies either has to employ only UK
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