Blog: Retailers say Brexit impact is driving up costs – Independent.ie

Retailers are bearing the brunt of the Brexit trade disruptions at the same time that the sector is being hammered by Covid.

ore than seven out of 10 retailers say they are experiencing Brexit-related supply-chain disruption, compared to 75pc of builders and 72pc of industrial businesses, according to Bank of Ireland’s ‘Economic Pulse’ report on the health of the economy.

‘Economic Pulse’ is an aggregated barometer of sentiment.

A pick-up in economic and commercial activity is anticipated as the year progresses, the bank’s chief economist, Dr Loretta O’Sullivan, said.

“While Level 5 restrictions and vaccine supply issues are causing frustration, there appears to be a growing sense that the setbacks of late are delaying, rather than derailing, the recovery,” she said.

However, Brexit is feeding into rising costs for some firms and falling orders for others. 

Seventy-one percent of retailers say Brexit has lifted their costs, with 69pc of construction firms, 67pc of industrials and 37pc in the services sector also reporting hikes.

The share of firms hit in the services sector is 41pc.

On the demand side, services – which range from banking to hotels – say they have been worst hit. Almost one-in-five service-sector businesses report reduced demand from UK customers as a result of Brexit, compared to 15pc among retailers and 13pc in industry.

The Suez Canal blockage places extra pressure on already strained supply chains right across Europe.

That’s according to a report from Moody’s analysts over the weekend. They see ‘just-in-time manufacturers’, notably in the car industry, as most vulnerable, rather than any of Ireland’s main sectors. 

Moody’s analysts are optimistic the effects of the Suez blockage will be shortlived. However, with about €8.5bn of commodities, industrial inputs and consumer products trapped on ships, costs are rising with each day the canal remains closed.

Online Editors

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s