The Impact Of Brexit On Retail Businesses: A Case Study Of Tesco

Research Objectives

The primary reason for choosing this topic is to analyze the various implications Brexit and its aftermath issues had on the several retail businesses in the United Kingdoms. This study chose Tesco as the specific case of the study so as to narrow down the research and broaden the scope of obtaining rich data and information. The effect of Brexit on the retail sector of the UK is a topic that requires much more insights that too from primary sources who have first-hand knowledge about the incidents.

The study aims to analyze the several implications and repercussions of the Brexit deal and issues with trade agreement and their cumulative effect on the retail sector and businesses of the United Kingdom. The study is going to cover an extensive base of literature on this topic and other topics similar to this to analyze what other researchers have found out during their research as well as include any gaps in this current study. The study will also obtain fresh information and data from contemporary primary sources regarding their knowledge and experiences on the topic of “The impact of BREXIT on retail businesses- A case study of Tesco”. The study will collect the information from two population perspectives so as to broaden the scope of the research to include both the experiences of customers and Tesco management.

The primary and broad aim of the research is to study and analyze the situation of Brexit along with its aftermath consequences. The specific aim of the research is to assess the impact of Brexit on the retail industry of the United Kingdom. The study will critically analyze the case of Tesco in the UK. 

The research objectives are the basis of the research and the researcher will use it as a guide to conducting the research. The objectives for this study include;

• To determine the effects of Brexit and resultant trade situations for the United Kingdoms.
• To determine the impact of Brexit on the retail industry of United Kingdoms.
• To analyze the Brexit effects on the retail business of Tesco.
• To assess the influences and implications of Brexit for the customers of Tesco.

The research questions will act as a structure for the researcher on the basis of which the study will be conducted. The research questions for this study are;

RQ1: What are the effects of Brexit as well as the resultant situations of trade on the United Kingdoms?

RQ2: What is the impact of Brexit on the UK retail industry?

RQ3: What are the effects of Brexit on the retail business of Tesco?

RQ4: What are the implications and influences of Brexit for the customers of Tesco?

The primary impact that has been felt by the people of the United Kingdom is that of a stark increase in the prices of several goods and products. Further researchers have looked into the economic matters to come up with the explanation that the goods and products that are made in Britain will also become more expensive than before (Symes and Phillipson 2019). People in general is obligated to pay for customs duties and import tax which is why the overall cost of online shopping has also went up by a lot. According to Lockwood et al. (2017), the significant impact of Brexit has been felt in immigration, the export as well as import tariffs, VAT, and for online as well as e-commerce retailers. The moderate impacts of the Brexit situation were felt on the regulations for product standards, competition law, intellectual property, as well as on data protection (Thompson and McLarney 2017).

Research Questions

After negotiating for four long years, the EU and UK finally signed an Agreement for Trade and Cooperation on 30^th December of 2020. This agreement represents the fundamental first step towards creating a new chapter for UK and EU relationships (Vandenbussche 2019). The new rules make immigration quite problematic and challenging, which will make it more difficult for companies like Tesco to attract as well as retain the great talents from Europe; it is not only difficult but also extremely costly. The agreement strictly forbids imposing quotas, tariffs, and export and import taxes at the EU-UK border (Tetlow and Stojanovic 2018). The EU importers need to verify the product’s origin before allowing it into the borders. The retailers in UK need to pay an import VAT to EU so that they can sell in EU. The VAT amounts varies from one member state to another so retailers can either comply by registering for the VAT in all countries or they can pass the costs to consumers and wholesalers (James and Quaglia 2019). Fetzer (2019) stated that the UK also no longer follows the EU framework of e-commerce directive. Tesco also needs to keep in mind that the Brexit trade agreement also includes strong protection provisions for the online consumers which provide a safety net to the consumers when they engage in any e-commerce related transactions (Pollitt 2017). This also includes things like marketing communications as well as unsolicited direct messages. Retail businesses like Tesco also need to comply with two diverse systems of regulations both in the UK as well as in the EU; this also includes conformity assessments for trading in both the regions (Springford and Whyte 2014). To reduce the business risks and also increase efficiency of the retail businesses like Tesco, the company needs to ensure that they successfully meet the safety requirement range and the quality expectations of both the systems of EU and UK.

The research philosophy helps the researcher to conduct in depth analysis as well as assists them to expand the study. The three primary research philosophies that are used by researchers include interpretivism, positivism, and realism. The interpretivism method is generally employed to assess the operations, management, and functions of a study. The positivism method typically analyses and also criticizes all the logical concepts and thoughts of a specific study. Lastly, the realism philosophy is mostly deployed when the researcher wants to create a mixed approach from both the above mentioned philosophies (Coral and Bokelmann 2017). This particular study will undertake the positivism research philosophy to study the various discourses and concepts in great detail so that critical conclusions can be generated in alignment with the contemporary situation of Brexit and UK retail sector.

The research design can be defined as the strategy used for answering the research questions by deploying empirical data. There are three primary research designs that are used by researchers which are explanatory, exploratory, and analytical. The exploratory research assesses the topic in its primary stages, whereas the analytical design basically evaluates the topic and tries to understand the entire study in a descriptive manner. The explanatory method typically develops significant links between the two research variables. This particular study will make use of the analytical design which can help the researcher to analyze and then deduce the logical findings with proper suitable reasons which can help to significantly back the study up (Park, Konge and Artino 2020). In this context, the researcher will further deploy the qualitative research design which is typically concerned with evaluating and establishing the hows and the whys of the specific phenomena of Brexit and its impact on UK retail sector and businesses like Tesco. 

Effects of Brexit on the UK Retail Industry

The data collection for this study will be conducted with the help of both the secondary as well as the primary sources. The primary sources will include the business managers as well as employees and customers of Tesco and the data will be collected through open-ended interview schedules. The data obtained will be supported by the information obtained from the literature reviews of theories and published papers from various relevant sources online.

The researcher will utilize the Purposive or judgmental sampling which is a type of non-probability sampling technique. In this method, the researcher primarily relies upon their self-judgment when choosing participants from their population of choice. The sample size will include 100 people comprising of 50 loyal Tesco customers and 50 employees and managers from Tesco Company.

The data analysis will be conducted by deploying a qualitative data analysis method from the two primary approaches of Inductive and Deductive approach. This study will be utilizing the inductive approach to qualitative data analysis. This approach is more thorough in comparison to the deductive approach as it is not based on any predetermined framework or set structure (Riffe et al. 2019).  

The research will be conducted by following strict ethical guidelines and protocols. All the research participants are free to do as they desire after hearing the research phenomenon and activities. They will have to sign consent forms saying they are willing to participate in the interviews. The researcher is bound to maintain confidentiality and anonymity of the participants and the information provided by them. The study also needs to ensure that authenticity of data is maintained throughout. The researcher will also collect a formal letter of authorization so that they can publish their work.  

The primary limitations of this study include a bigger participants and sample size list belonging from various Tesco stores throughout the United Kingdom could have been more beneficial. Budget and time constraints have limited the researcher to only work with one business as the case study and generalize the results back to the larger retail sector.

Reference List

Coral, C. and Bokelmann, W., 2017. The role of analytical frameworks for systemic research design, explained in the analysis of drivers and dynamics of historic land-use changes. Systems, 5(1), p.20.

Fetzer, T., 2019. Did austerity cause Brexit?. American Economic Review, 109(11), pp.3849-86.

James, S. and Quaglia, L., 2019. Brexit, the city and the contingent power of finance. New political economy, 24(2), pp.258-271.

Lockwood, M., Froggatt, A., Wright, G. and Dutton, J., 2017. The implications of Brexit for the electricity sector in Great Britain: Trade-offs between market integration and policy influence. Energy Policy, 110, pp.137-143.

Park, Y.S., Konge, L. and Artino, A.R., 2020. The positivism paradigm of research. Academic Medicine, 95(5), pp.690-694.

Pollitt, M.G., 2017. The economic consequences of Brexit: energy. Oxford Review of Economic Policy, 33(suppl_1), pp.S134-S143.

Riffe, D., Lacy, S., Fico, F. and Watson, B., 2019. Analyzing media messages: Using quantitative content analysis in research. Routledge.

Springford, J. and Whyte, P., 2014. The consequences of Brexit for the City of London. Centre for European Reform.

Symes, D. and Phillipson, J., 2019. ‘A sea of troubles'(2): Brexit and the UK seafood supply chain. Marine Policy, 102, pp.5-9.

Tetlow, G. and Stojanovic, A., 2018. Understanding the economic impact of Brexit. Institute for government, pp.2-76.

Thompson, J. and McLarney, C., 2017. What effects will the strategy changes undertaken by next Plc have on themselves and their competition in the UK Clothing Retail Market?. Journal of Commerce and Management Thought, 8(2), p.234.

Vandenbussche, H., 2019. Sector-Level Analysis of the Impact of Brexit on the EU-28. Report for Flanders Department of Foreign Affairs, Belgium.

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