For a long time, Brexit has been something that has been looming on the horizon for UK businesses. With no real idea of what any deal with the EU will be at the moment, it’s hard to be really clear about what the impact will be to your business.
In this blog, we look at some of the areas which we feel will be impacted when the new rules come into force.
If you are a business dealing in products or the manufacturing of products, then it is likely that the supply chain you have currently will be affected in some way. There are different ideas of how much impact Brexit will have on any businesses trading with Europe, but we expect there will be some teething issues at the very least.
If you have not already, then you need to be really clear about where there are likely to be bottlenecks, and what effect these will have on your business. Now is the time to be looking at if there is any way you can work around these issues, and to be honest about how this will impact your customer when they want to do business with you.
It’s worth remembering that this works both ways too, not just the import of goods from the EU, but also the export from the UK to the EU.
Rules on origins
This is where it could get very complicated, particularly for manufacturing companies who are sourcing components from multiple counties outside of the UK.
For example, if you’re a company that makes computers, the components may be shipped in from all around the world. However, if the bulk of the time to create the end product is in the UK, then the origin would be classed as the UK.
However, if just the assembly is in the UK and the time to do this is less than say for the motherboard which is shipped from elsewhere, then the country of origin would not be the UK.
HMRC has some guidance on what this actually means to a business, so it’s always worth checking here for updated information.
This is more likely to affect people who have to directly import or export from the UK/EU, but it’s not something to be underestimated by those of you who deal with businesses who import from the EU.
With Brexit, there is going to be a whole different batch of paperwork that will be needed as we’re no longer part of the EU. This means that it is very likely there will be delays at any entry points in the UK, as all goods coming in or out will need to be checked.
Hopefully, over time, this will settle, but there is bound to be some friction at the start.
These customs checks could have a massive impact on businesses and the time it takes for goods to arrive in the UK. Is your business able to absorb these delays? Or do you need to start thinking about alternatives?
All of these points above have the potential to add costs to your business. Delays at ports, supply chain issues or even the rule of origins may mean that there are going to be extra overheads to you.
Whilst some businesses may be able to absorb these, others may not.
Now is the time to be really looking at where there could be additional costs for you and what you can do to keep your customers informed. Whilst things are still very uncertain, it is worth looking at what the worst-case scenario may be and how you can plan for this.
Whilst we are still in this period of transition, we are very much aware that a number of businesses are concerned about what the future may hold, particularly as we are having to plan for not only Brexit but Covid too.
If you need some support to transform your business for a post-Brexit world, then please get in touch. We’d be happy to help.