John Lewis among UK firms scrapping overseas deliveries

By Simon Read
Business reporter

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Image source, Getty Images

Department store chain John Lewis is one of many British business that have scrapped overseas deliveries.

Until last month, it offered EU delivery through its website, but the offer has now been withdrawn.

John Lewis said the move was not related to Brexit, but because its new strategy was to focus on the UK.

However, confusion surrounding post Brexit trading rules has led other firms such as Debenhams and Fortnum & Masons to suspend EU deliveries.

Luxury food store Fortnum & Masons warns customers on its website: "We are temporarily unable to deliver to Northern Ireland or countries in the European Union."

Meanwhile store chain Debenhams has temporarily shut its online business in Ireland.

"We are currently unable to deliver orders to the Republic of Ireland, due to uncertainty around post-Brexit trade rules," it said.

John Lewis told the BBC the decision to scrap overseas deliveries was based on company strategy.

"As part of our Partnership Plan for the next two years, in John Lewis we have decided to focus on areas of the business that will deliver products and services for our local UK customers," it said.

"As such, we are no longer pursuing international expansion and decided to cease our online international delivery service in mid-December."

Earlier this week, the BBC reported that some EU specialist online retailers have said they will no longer deliver to the UK because of tax changes which came into force on 1 January.

Accountants firm UHY Hacker Young said fears of extra costs was causing firms to suspend deliveries.

"Many UK businesses exporting to the EU are going to be hit by tariffs," said Michelle Dale, of accountants UHY Hacker Young.

"Businesses have also been completely blindsided by the 'rule of origin' part of the deal, which leaves them at a major competitive disadvantage when selling in the EU.

"Unfortunately, not enough was done to prepare them for this."

Rule of origin

Under the "rule of origin" clause, goods made, or containing components made, outside the UK or EU - such as in China - and resold by UK businesses are now subject to VAT and import duties when sold to the EU.

Many British businesses exporting to the EU have much of their supply chain based outside the EU, meaning they will fall foul of the clause.

Some have suspended sales to customers in the EU as they try to establish whether import duty is due or if they can switch to UK or EU components.

But West Midlands bicycle saddle maker Brooks England has taken it a stage further and suspended orders to the UK.

"We continue to produce each leather saddle in our West Midlands factory in more or less the same manner as we have for over 150 years," it said.

"However, upon their completion, these saddles are shipped first to our logistics centre and from there to cyclists around the world.

"Due to this, the ongoing changes in the Brexit situation have made it necessary to temporarily suspend all new orders to the UK at this time," the firm added.