Preparing for Brexit - A tale of deals and shippers

22.01.2019

 

In the words of the UK’s Prime Minister Theresa May; “Brexit means Brexit.”


But, and that’s a big but, what does Brexit actually mean? A number of different scenarios have been mooted: the Norway option, the Canadian model, the ‘no-deal’, a second referendum… In recent weeks the ‘no-deal’ option appears to have become more likely with the British Government telling 140,000 companies to prepare for this scenario.


This news has been poorly received by a number of organisations, which were quick to point out the implications of such a move on their transport operations. Supply chains are leaner and more meticulously planned than ever and for many a raft of new regulations and tariffs would not be welcome.


JOC.com reports that a number of shippers are concerned at the potential impact and are facing increased costs as they stockpile goods in preparation. Long waiting times at borders, ports and warehouses are also feared.


Staying agile under pressure


As mentioned above, some shippers have already begun stockpiling goods in an attempt to mitigate any potential delays. While this might prove a short term solution, it could also backfire by driving up labour costs, causing congestion and increasing storage costs. But what other options are there?


Well aside from stockpiling, the key is to remain as flexible as possible. That might mean exploring alternative sourcing options, which could serve as a short term solution to combat potential shortages. In addition, current logistics contracts need to be revisited, to ensure no surprises when something changes.


Preparing for multiple scenarios


On top of more strategic changes, businesses need to prepare for an array of new rules and regulations. A hard or ‘no deal’ Brexit could result in customs checks being implemented for the first time in close to half a century and the onus will be on shippers to ensure their carriers hold valid licences to operate in both the EU and UK.


These changes have the potential to have a huge impact on supply chains where an estimated 10,000 trucks are already delayed by customs checks each day. Companies which rely on ‘just in time’ deliveries could potentially be the hardest hit, as unpredictability and delays rack up waiting times.

 

The early bird gets the worm


There are short and long term benefits to getting it right. It’s this type of preparedness that helps companies stand out and succeed in difficult circumstances. Being one of the few businesses that continues to meet its obligations despite a seismic change is a real badge of honour. The type of achievement that helps build relationships and trust with clients.

We all know that challenges translate into opportunities for those able to take a holistic view of the situation, so don’t delay. Make sure you’re ready whatever happens!

 

Written by
Johan Vagerstam

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