Brexit's Impact on UK Retail Sector Investments & HQ Relocation

This dissertation investigates the impacts of Brexit on foreign retail investments in the UK, focusing on how companies are shifting their headquarters to the Netherlands. It begins by outlining the research background, problem, significance, aim, objectives, and questions, setting the stage for an in-depth analysis. The literature review explores the current scenario in the UK, the impact of Brexit on foreign investments, the UK retail industry, and the implications of Brexit on the sector. It also examines how UK retailers are creating business opportunities in the Netherlands. The methodology chapter details the research approach, philosophy, strategy, data collection methods, and analysis techniques. Findings and results are presented thematically, addressing the impact of Brexit on foreign investments, the current Brexit and retail scenario in the UK, and the implications for creating business opportunities in the Netherlands. The analysis and discussion chapter delves deeper into these themes, providing insights into the challenges and opportunities. The conclusion summarizes the key findings, offers recommendations for UK retail companies, and suggests areas for future research.

Running head: BREXIT IMPACTS ON INVESTMENTS IN UK RETAIL SECTOR
Brexit Effect on Investments in UK and Major Players Shifting their Headquarters Outside UK
and Create New Opportunities in Netherlands
Name of the University:
Name of the Student:
Authors Note:

1BREXIT IMPACTS ON INVESTMENTS IN UK RETAIL SECTOR
Executive Summary
Brexit would have great impact on the foreign investments taking place within the nation.
Analyzing such impact takes into account the impact of increasing trade costs through
anticipating that the policy related with FDI remained unchanged. The aim of the study was to
analysis the impact of Brexit on foreign retail investments in UK due to which these companies
are shifting their headquarters to other nation such as Netherlands. This data collecting method
was employed as it facilitates in attaining detailed insights on the research problem. In addition,
it has also facilitated in collecting most relevant secondary data that can support reliable research
findings and such data is also easily available on the online sources that make the data collection
less time consuming and expensive. The report also highlighted certain system to challenges that
are likely to be faced by the retail organizations and such issues are to be faced because of Bruit
regulations includes changing consumer behavior, oversupply of the physical stores, increased
level of legacy debt, compliance along with regulatory and compliance costs, geopolitical along
with macro-economic costs along with the lack of talent at the top of retail businesses that can
facilitate in delivering necessary changes that is deemed to negatively impact the operations of
these businesses. The retail companies of UK are also recommended to set up a subsidiary or
entity within EU particular in case of selling products within the EU. Implementing such
recommendation can facilitate in maintaining fiscal representation for VAT purposes, trusting
along with compliance that can facilitate the companies in attaining exceptional advantages from
the market opportunities in Netherlands.

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Acknowledgement
I feel great pleasure in acknowledging the assistance along with contributions of several other
individuals in contribution to the success of the dissertation. Firstly, Iwouldprefer to thank my
supervisor for her support, ideas along with feedbacks at the time of the proceeds in completing
this dissertation. Devoid of her support and guidance, this dissertation cannot be accomplished
within time. Finally, I would also like to express my gratitude to my peers for their total support
along with encouragement.

3BREXIT IMPACTS ON INVESTMENTS IN UK RETAIL SECTOR
Table of Contents
Chapter 1: Introduction....................................................................................................................6
1.1. Research Background.......................................................................................................6
1.2. Research Problem.............................................................................................................7
1.3. Research Significance.......................................................................................................8
1.4. Research Aim and Objectives...............................................................................................9
1.5. Research Questions.............................................................................................................10
1.6. Research Structure..............................................................................................................10
Chapter 2: Literature Review.........................................................................................................11
2.1. Introduction.........................................................................................................................11
2.2. Current Scenario in UK......................................................................................................12
2.3. Impact of Brexit on Foreign Investments...........................................................................14
2.4. UK Retail Industry Background.........................................................................................16
2.5. Implications of Brexit on the UK Retail Industry..............................................................19
2.6. UK Retailers Creating Business Opportunities in Netherlands Due to Brexit Implications
...................................................................................................................................................22
2.7. Research Gap......................................................................................................................25
2.8. Conceptual framework........................................................................................................26
2.9. Summary.............................................................................................................................27
Chapter 3: Research Methodology................................................................................................28

4BREXIT IMPACTS ON INVESTMENTS IN UK RETAIL SECTOR
3.1. Introduction.........................................................................................................................28
3.2. Research Approach.............................................................................................................28
3.3. Research Philosophy...........................................................................................................30
3.4. Research Strategy...............................................................................................................31
3.5. Data Collection Methods....................................................................................................32
3.6. Data Analysis......................................................................................................................33
3.7. Ethical Considerations........................................................................................................33
3.8. Limitations..........................................................................................................................34
3.9. Summary.............................................................................................................................34
Chapter 4: Findings and Results....................................................................................................35
4.1. Data Presentation in Themes Relevant to Research Objectives.........................................35
Chapter 5: Analysis and Discussion of Findings...........................................................................48
5.1. Theme 1: Impact of Brexit in the Foreign Investments within UK Retail Industry...........48
5.2. Theme 2: Current Scenario of Brexit and Retail Industry in UK.......................................52
5.3. Theme 3: Implications of Brexit in UK Based on which they are Creating Business
Opportunities in Netherlands.....................................................................................................58
Chapter 6: Conclusion, Recommendations and Future Research..................................................63
6.1. Conclusion..........................................................................................................................63
6.2. Recommendations...............................................................................................................67
6.3. Future Research..................................................................................................................69

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References......................................................................................................................................71

6BREXIT IMPACTS ON INVESTMENTS IN UK RETAIL SECTOR
Chapter 1: Introduction
1.1. Research Background
UK has a strong track record in securing the overseas investment is being put at risk by
Brexit with increased number of jobs created along with foreign capital deployed in Britain
dropping sharply since the EU referendum as per the analysis carried out by Financial Times.
Since the EU referendums the number of new foreign retail investments along with business
expansions isindicating disconcerting reductions. It has been observed that 2017, there were
more than 26000 foreign owned business within UK with the majority of them controlled by the
European nations (Booth et al. 2015). Overseas investors are focused on moving assets out of
UK due to Brexit. With increasedpopulation of UK the strong rule of law have increased
opportunity for the foreign investors. Brexit along with recent tax as well as lending rules
imposed by the government resulted in increased uncertainty and along with that the economic
implications of Brexit are attaining an increased focus. Due to the Brexit regulations FDI is
considered as an important component of the UK economy and because of such regulations slow
economic growth has been observed between the years from 2010 to 2017. Due to increased
tariffs imposed in the situation of Brexit he retail FDI within UK has been adversely impacted
disruption the advantageous impacts of FDI including technological now-hw, improved
workplace skills along with increased integration of the local companies within the international
economy (Boden et al. 2017).
It is also estimated that striking a comprehensive trade deal is deemed to manage the
negative impacts of Brexit on retail FDI within UK. In addition, it has also been gathered from
analyzing the existing macroeconomic estimates that FDI affects the growth combined with an

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estimate of drastic Brexit impacts. Such impact is considered to result in 22% drop in the retail
companies FDI by 22% over the next few years (Durrani and Forbes 2017). Brexit regulations
being strict in UK can result in droop within FDI of the major retail players within the nations
resulting in 3.4% decline in the real income that is around 2,200 of the GDP in each household.
In addition, it has also been analyzed that the drastic impacts of Brexit can affect the operations
of retail companies in UK that can result in incomes losses and majorly static losses due to lower
trade by around 2.6%. Estimates of Brexit impact in the UK retail industry imply that the UK
retail offerings production is deemed to drop by 12% and the prices are increased by 2.5%
(Clarke and Ramscar 2019). Even if the UK retail organization manages a comprehensive trade
deal and maintains the tariffs at zero, the production within the retail industry is deemed to
observe a decline on the business. Considering such revelations, the current research will focus
on analysis of the drastic impacts of Brexit on the foreign retail investments within UK because
of which they are deciding to shift their headquarters in other opportunistic nations such as
Netherlands.
1.2. Research Problem
Brexit turned out to be a political shock that resulted in high uncertainty in the UK retail
sector of Canada. It was also been revealed that Brexit resulted in causing change within the
investment as well as employment for companies through causing business uncertainty along
with sales impact. Moreover, it has also been analyzed that the retail companies within the UK
economy that is involved in exporting a league fraction of its produced goods and services to EU
than imports (Shaw, Smith and Sculll 2017). In addition, it have also gathered that the retail
sector is likely to be highly sensitive to the impact of Brexit and a huge fraction of it is relied on
the nature of financial agreement with EU. One of the most drastic impacts of the Brexit

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regulations is attaining exposure to the labor and trade that drastically determines the sensitivity
of the sector. In a situation of hard brexit trade as well as labor is equally restricted. In a situation
of free labor UK retail companies are deemed to deal with considerate restrictions on trade but
will attain the opportunity to adhere free movement of EU labor (Crawfurd, Mitchell and
Anderson 2017). Moreover, the actual impacts of the retail sector exports is determined by a
combination of proportion of exports destined to the EU marketplace and any regulatory
restrictions on the sale after Brexit or the tariff rate that comes into effect. In a situation of free
trade UK retail companies are observed to attain considerate concessions on trade, however,
these companies is evidenced to face significant restrictions of labor. Considering such research
problem, the recent study analyzed the impact of Brexit on foreign retail investments in UK. In
analyzing the same, the major opportunities for which these companies intend to shift their
headquarters outside Netherlands has also been revealed (Stewart, Cooper and Shutes 2019).
1.3. Research Significance
Considering the identified research problem, this study had significance for revealing the
drastic impacts that are caused by the Brexit regulations in UK which is affecting business
operations of the retail investments in the nation (Hoekman et al. 2016).Based on such
revelations, the research findings had considerable implications in recommending business
development opportunities for the retail companies in situation of Brexit along with offering
solutions for them in shifting their headquarters in the opportunistic nations such as Netherlands.
The research have also revealed that the retailers in UK are drastically dealing with the
fluctuations in the exchange rate that is deemed to be a significant issue for the sector which
imports a considerable proportion of its merchandise (Tonra 2019). The research also had useful
implications in explaining that as retailers’ currency hedges run out of strained balance sheets

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attain their limits and the process of the goods are also deemed to increase that has affected the
operations of the retail companies. The research analyzed the facts related with the impact of
Brexit regulations in –depth and revealed and considered developing recommendations based on
the interconnected nature of UK and EU supply chains that is likely to be a vital concern for the
organizations. The revelations of the study also explained in details that the supply chain acts as
the only strong link with the transport dependent sectors considering that the retail organizations
heavily dependent on the ability to deliver goods (Kreindler, Gilbert and Zimbron 2016).
Following brexit, the ability to shift goods cross borders and focused on the same, the retail
industry requires to think about the manner in which the retail companies transport-enabled
supply chain depends on the freedoms related with being part of EU.
1.4. Research Aim and Objectives
The aim of the study is to analysis the impact of Brexit on foreign retail investments in
UK due to which these companies are shifting their headquarters to other nation such as
Netherlands. The objectives that are to be addressed through completion of the research are
indicated below:
 To analyze the impact of Brexit in the foreign investments within UK retail industry
 To evaluate the current scenario of Brexit and retail industry in UK
 To analyze implications of Brexit in UK based on which they are creating business
opportunities in Netherlands
 To offer suitable recommendations based on the data analysis findings that can facilitate
the UK based retail companies in attaining strategic growth in presence of Brexit
regulations.

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1.5. Research Questions
The research questions that are to be answered through completion of the research are
indicated below:
 What is the impact of Brexit in the foreign investments within UK retail industry?
 What is the current scenario of Brexit and retail industry in UK?
 What are the implications of Brexit in UK based on which they are creating business
opportunities in Netherlands?
 What are the suitable recommendations based on the data analysis findings that can
facilitate the UK based retail companies in attaining strategic growth in presence of
Brexit regulations?
1.6. Research Structure
The first chapter of the dissertation focused on providing a detailed introduction of the
study background and problem along with explaining the significance of carrying out the current
research. In addition, the aim and objectives set for the study has also been elaborated along with
describing the research questions that are to be answered in this study. The second chapter of the
dissertation will elaborate the literature review where the previous researches on the Brexit along
with its effects on the UK based retail investments has been explained. Analyzing the literature
review facilitated in revealing the research gap which addressed developed questions in this
research. Third chapter of the dissertation has focused on analyzing the suitable research
methodology that has been employed in the research for attaining reliable and valid findings.
This chapter analyzed the suitable research approach, strategy, design and data analysis
techniques in attaining constructive research findings. Fourth chapter of the research considered
carrying out data analysis that facilitated in gathering reliable findings aligned with the research

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objectives. This chapter explained suitable data analysis techniques and methods based on which
the data collected has been evaluated. Fifth chapter of the research will conclude the study
through highlighting important findings from the research. In addition, this chapter considered
offering suitable recommendations along with elaborating the future directions of the study.
Chapter 2: Literature Review
2.1. Introduction
The literature review section explains that despite UK being one of the opportunistic
nations to start businesses, such situation can change because of the impacts caused by Brexit
that has created uncertainty for businesses. The literature review section explains the previous
researches carried out on the impact of Brexit on the retail investments in UK (Acquah-Andoh,
Ifelebuegu and Theophilus 2019). Moreover, it also explains the reasons for which the major
players such as Dyson, Panasonic and Muji shifting headquarters outside UK and generating
opportunities in other nations such as in Netherlands. Moreover it also focuses on comparing and
contrasting the findings of various researches regarding the impact of Brexit in UK retail
investments along with the issues faced by these organizations. From analyzing the existing
literature and previous researches on the topic research gap is identified that the current research
will attempt to address. The conceptual framework developed is based on the identified factors
related with Brexit that has impacted the retail investments within UK drastically (Adler-Nissen,
Galpin and Rosamond 2017). Based on the results of the literature review, the current research
intends to evaluate the impact of increased trade expenses along with capital restrictions on the
production on the foreign investments and welfare within UK prior to the referendum.