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In a recent podcast, we spoke with Lawrence from Bloomberg about how economic trends and policies are shaping e-commerce in the UK, US, and beyond. Here are the highlights and actionable insights.
Economic Overview: UK vs. US
The UK
The UK faces challenges like:
National Insurance Increases: Straining businesses, limiting investments and hiring.
Consumer Confidence: Muted post-Christmas, reflecting caution.
Plastic Tax: Sudden implementation squeezing retailer margins.
The US
The US shows resilience:
Consumer Spending: Robust despite high inflation, helped by Black Friday sales.
Political Changes: Anticipated deregulation and tax cuts under Donald Trump, but caution around tariffs.
Implications for Retailers
Supply Chains: Tariffs, like the proposed 60% on Chinese imports, may increase costs. Businesses are exploring nearshoring or domestic production to adapt.
Targeting High-Income Consumers: UK households earning over £50,000 are more optimistic and willing to spend.
Inflation Strategy: Adjust pricing gradually, communicate value, and explore cost-saving measures like automation.
Practical Steps for E-commerce Businesses
Revise Pricing: Test small increases and position products as high-value.
Optimise Supply Chains: Diversify sourcing and consider local production.
Leverage Data: Monitor consumer confidence indices and economic forecasts.
Retain Customers: Enhance first-purchase experiences and invest in loyalty programmes.
Monitor Global Trends: Stay informed on policy changes affecting trade and taxation.
Looking Ahead
2025 is a year of implementation following 2024’s global elections. Retailers must stay informed and agile, ready to adapt to economic and policy changes.
Check out the full podcast episode here.