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Retailers 'running out of options' for protecting shoppers from significant price increases since Brexit decision

Laura  Barnes
Retailers 'running out of options' for protecting shoppers from significant price increases since Brexit decision

The British Retail Consortium (BRC) has revealed that non-food retailers are struggling to keep prices down on imported goods since the EU referendum.

In its latest BRC – Nielsen Shop Price Index, the consortium found that overall shop price deflation was 0.3 per cent in August, a slight deceleration from the 0.4 per cent fall in July.

Except for June of this year, this is the shallowest deflation rate since November 2013.

The deflation rate for prices of non-food products specifically was 1.3 per cent, the slowest rate of deflation since April 2013. Electronics posted the slowest rate of deflation on record (the SPI started in 2006).
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“Non-food deflation reached its lowest rate in more than four years in August as overall shop prices edged closer to inflation,” commented Helen Dickinson OBE, Chief Executive of BRC.

“The reality is that with protection from hedging policies coming to an end, non-food retailers are running out of options for protecting shoppers from the significant increases in the price of imported goods since the EU referendum in June last year.

“We expect non-food prices to continue trending towards year on year inflation.”

The BRC has also released a new report on how Brexit boarder controls could affect retailers in the UK.

Now that the UK Government has launched the next phase in the discussion on our future trading relationship with the EU, the BRC believes there needs to be wider recognition of the complexity and scale of the challenge pertaining to future customs controls.

We want to work with the Government to develop a system which works for consumers.

Helen Dickinson OBE, BRC.

While the consortium acknowledges the need for a strong customs agreement, it has pointed out that there are two vital considerations yet to be mentioned. “Firstly, the significant investment required in the UK’s ports, roads and infrastructure to get systems ready for Brexit day and thereafter. Secondly, the suite of new agreements supplementing customs that are necessary to side-step additional red tape at ports and docks and prevent delays to goods,” said BRC.

“A strong deal on customs is absolutely essential to deliver a fair Brexit for consumers. Whilst the Government has acknowledged the need to avoid a cliff-edge after Brexit day, a customs union in itself won’t solve the problem of delays at ports,” said Dickinson.

“So to ensure supply chains are not disrupted and goods continue to reach the shelves, agreements on security, transit, haulage, drivers, VAT and other checks will be required to get systems ready for March 2019.

“We want to work with the Government to develop a system which works for consumers, so that there’s no difference in terms of the availability of affordable, quality products when they make purchases or visit stores post-Brexit. We believe our recommendations will help to achieve that and enable our world-leading retail industry to continue serving customers and contribute to the growth of the UK economy.”

Tags: Retail , brc , brexit , eu referendum

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