Unsurprisingly, Brexit is having a major impact on consumer and retail businesses, who often have complex supply chains. In the absence of a deal, such businesses are facing uncertainties over which rules will or will not apply. A further difficulty relates to concerns over UK growth. Some larger organisations have reportedly delayed investment decisions, and are considering relocating jobs outside of the UK.
Aside from potential future trade ‘blockages’ and increased regulatory barriers between the UK and EU, a significant risk to supply chain management could well come from another factor – time. Border congestion, additional documentation and customs checks will slow the flow of goods, which in turn will lead to increased shipping times (inbound and outbound), creating issues for time-sensitive industries.
Much will depend on whether the UK leaves both the Customs Union
and Single Market (a so-called hard Brexit), or remains closely aligned to the EU Single Market and Customs Union (a so-called soft Brexit). Both scenarios will impact existing supply chains making them vulnerable to border checks and congestion. Identifying the best way to minimise the impact of Brexit on the supply chain is easier said than done. So what measures can retail and consumer organisations take?
- Consider opportunities andrisks, and use this to inform critical business decisions by categorising these as either short or long term
- Identify alternative routes for your EU-UK shipping connections
- Review sales activity on a periodic basis. Check if the mix of sales has changed, for example across channels, categories or geographies
- Communicate with, and review your supplier base. Companies should actively communicate with their suppliers and review their preparedness in terms of business continuity management, and either support or change high risk suppliers
- Keep abreast of new regulatory and border developments. As EU-UK negotiations progress, monitor key developments to understand how specific sectors may, or may not, be included in a future trade agreement.
As a Director within Norman Broadbent’s Supply Chain & Procurement Practice, I’m working closely with clients to identify and engage with senior supply chain professionals, who can be deployed at short-notice, on an interim basis, to help minimise the impact of Brexit, set up new agreements, and implement lean supply chains.
If you would like to discuss this article in more detail, learn more about the Norman Broadbent Group, or perhaps discuss your people or organisational, please do not hesitate to contact James Peskett via
james.peskett@normanbroadbent.com