Like most things, shopping online in England tends to be expensive. It’s only recently that the country introduced an ‘Amazon tax’, allowing online retailers to pay the annual fee of £3.2bn (£250m more than it was previously!) in order to maintain a compulsory VAT sales tax. This is expected to result in a slowdown in online retailing, since a large proportion of the current online shopping market is currently derived from business with high VAT rates.
A recent survey by the Association of Convenience Stores (ACS) found that one third of shops did not think VAT was the best option to raise additional funds. Instead, they are demanding a rise in business rates. To cover the financial shortfall, the Government plans to ‘slow down the growth of online shopping’. While that sounds reasonable enough, a second survey conducted by ACS found that nine out of ten respondents were likely to switch to another delivery method. Not surprisingly, a third said they were unable to afford the increase, even with a reduction in the delivery cost of a single order.
Furthermore, some people are going out of their way to avoid being charged VAT on their online shopping. According to a research report by the Office for National Statistics (ONS), one in five purchases made online in England were paid for with cash, while half of all food and drink online orders were also paid for with cash.
Shopping on Credit Cards for Food in England
Unsurprisingly, not everyone is willing to pay for food online. As a result, credit cards have become the cheapest way for some people to purchase food.
Credit card loans have an average interest rate of 25.25%, according to research by Comparethemarket.com, so those who aren’t able to repay their credit card bills in full tend to find the interest rates unbearable. If that’s the case, using credit cards as a way to save money on food is a great way to avoid paying any interest whatsoever. The advantage of using a credit card instead of a debit card is that your spending will not show up on your credit card statement.
As the above statistics indicate, there are many people who use credit cards for food purchases in England, yet we do not see too many people using their credit cards to pay for food online.
Food Delivery in London
Unfortunately, when we dig a little deeper, we find that the majority of the food we see online are from delivery services based outside of London, with no visible gap between the costs of items sourced locally and those from as far away as suppliers like Orange County CBD. It seems the capital city’s reputation as a culinary hotspot is only sufficient to attract people who can afford the high delivery costs.
For example, Deliveroo charges a minimum order of £11.50 ($15.30), including delivery, a maximum delivery time of 30 minutes, and a minimum charge of £1.50 ($2.50) for each item. In addition, those who are already signed up to the delivery service can order additional items at a high price. When the delivery time starts, the delivery charge jumps up to £1.30 ($1.75), depending on the time and distance travelled.