One: the pound plummeted and profits shrank.
I still remember that shortly after the results of the referendum on the 24th came out, many people in the circle of friends said that 8% of the profits in the British market were gone. Facts have proved that the pound depreciated sharply that day.
The first referendum also shows that the British market has officially entered a turbulent period, and the exchange rate of the pound will not be too optimistic in the short term. The seller "Dragon Chasing the Moon" told Hugo. At present, the mainstream view is that the devaluation of the pound will reach 10%- 15%.
He said that Britain itself is a European website with a relatively low profit margin, but the market is large enough. If the pound depreciates by 15%, the cost will increase by 10%, and Britain will become a low-profit market. Therefore, Brexit has a huge negative impact on cross-border electronic commerce. If cross-border e-commerce needs to internally absorb rising tax costs, it is pessimistic to estimate that profits will be "halved" in the short term.
Two: local surgery is the way out, but the cost will definitely rise.
Generally speaking, the British market will raise the tax (VAT) regulatory threshold, and some sellers may automatically quit. However, as long as the seller stays, the cost of localization will become a reality, which is reflected in:
The distribution difficulty and cost of 1. The FBA in Britain will increase, and it will be difficult for one country to put it in storage and five countries to deliver it;
2. Overseas is often one in the UK and one in the EU, which is also a major aspect of the increase in operating costs;
Britain will pay close attention to the value-added tax, which will be more serious after Brexit. Trade barriers will only be high, not low. Value-added tax will disrupt the pace of scalpers. Compared with the traditional model, the tax that should be paid should be paid, and the tax that can be deducted should be deducted, and the cost will rise accordingly.
Another big problem is the devaluation of the pound, which directly requires the seller to digest the profits and internal costs for consumers; The broadcasting fee items should be applied for the EU trademark and the British trademark respectively, and the British trademark needs to pay 5000- 10000 yuan more than before for separate registration.
Three: Are sellers good or bad or the biggest "beneficiaries"
Only the founder of Anju Logistics can have a slightly different view. He told hugo.com that the profit would decrease according to the fluctuation of the seller's own channel cost. However, they all think that Britain is a good seller.
Funk pointed out that big sellers have the capital to operate locally in various countries. 20% VAT is not difficult for them. The tax they should pay is paid and offset. They are willing to do so to reduce the risk. However, if small and medium-sized sellers use Amazon FBA, in addition to the pressure of rising operating costs, their financial strength is limited. So generally speaking, hypermarkets are more favorable.