It goes without saying, that during the last few years political uncertainty domestically and abroad has had a big impact on UK manufacturers. Since Britain confirmed it would be leaving the EU in 2016, the drawn-out process has continued to reduce the global demand for British manufactured goods[1] as well as cost manufacturers who have put growth plans on hold.
This has been partly responsible for shutdowns, job cuts and falling orders and output forecasts. With all this it would be hard to look for positives but it isn’t all doom and gloom. Although manufacturers face significant challenges posed by the changing global economy there are ways businesses can work closely with their supply chain to minimise the impact of macroeconomic factors, such as the trade tariffs recently imposed on some UK goods by the US.
It was never going to be easy for businesses, for some, connections have been built across the EU for more than four decades and in the event of a no deal, manufacturers will have limited access to the EU market. It means preparation is really key for 2020.
Just-in-time deliveries are crucial to manufacturers as they help to reduce costs and ensure projects meet strict deadlines. Yet they tread a fine line, and if communication isn’t clear throughout the supply chain from supplier to logistics partner to manufacturer, the whole project could be put in jeopardy.
This is even more integral with the UK expected to finally leave the EU in 2020. Predicted delays after this time are expected to be more than 20 hours, because of the extra burden on HGV drivers being required to declare which goods they are carrying and their origin.
That’s why it’s really crucial that manufacturers know exactly which documentation will be required in a post-Brexit UK next year.This is easier said than done with details of an abrupt end to UK membership of the EU, or a transition period still unknown. In October, the Road Haulage Association announced that “time is running out” for businesses to prepare and earlier in the summer it published a checklist for a no-deal scenario.
Manufacturers should use tools and frameworks such as this, and working with their logistics partners, map out their supply chain to understand where hold ups might be caused to better forward plan deadlines and completion dates.
It’s also a good idea to have a plan b in your back pocket,to identify alternative suppliers either in the UK or in countries where tariffs are relaxed. Working in close collaboration with your logistic partners can help to ensure issues can be identified and resolved as quickly as possible. No company working with suppliers in the EU is going to be able to avoid delays completely, but preparation is key to minimising impact.
[1] https://www.theguardian.com/business/2019/sep/02/uk-factory-output-brexit-eu-manufacturers
