Getting goods from the U.K. to EU is no longer plain sailing
Just a few months into the U.K.s new relationship with Brussels, British exporters to the EU are struggling with mounting Brexit red tape and border disruption. Half (49%) of U.K.-based exporters were facing extra costs and delays in shipments to and from the continent, due to extra border checks and paperwork, according to the British Chambers of Commerce (BCC).
Before Brexit, shipments could be transported with minimal paperwork and delivered to destinations in other EU member states relatively seamlessly. Now there is a U.K. export declaration process, an exit border clearance process, a transit country process when cargo transits third countries, and an import declaration process at the destination country.
Sam Tyagi, founder and CEO of document management platform KlearNow, which is working with hundreds of U.K. businesses exporting to the EU, says: Goods that used to flow freely must now include additional documentation and other requirements, for example, phytosanitary certificates, testing and analysis reports, and other health and safety restrictions. Products such as perishable foods have an added time constraint that is causing a lot of headaches, while makers of some products, like perfumeries, have stopped shipping altogether until they can implement the required protocol.
Red tape is seriously impacting business for Plymouth-based ethical fishmonger Sole of Discretion, which buys fish exclusively from inshore from small boats, which benefits coastal communities. Around 35% of their annual sales come from a customer based in Belgium. The two companies have a shared ethos of preserving fish stocks and the livelihoods of the small-scale fisher.
The company normally makes twice-monthly exports of fish, but since the start of 2021 it has failed to send any, because the haulage company they use has yet to agree to collect their fish, citing too many problems with border control.
Founder Caroline Bennet says: We made our third attempt to export yesterday, again without success. This time it was rejected because the label had U.K. rather than United Kingdom. Every week we are given new rejection reasons. I dont know why they couldnt give us this information from the start.
The additional workload is taking its toll. Every shipment now requires eight documents, compared to the previous single document, effectively an address label. The excessive red tape incurs a huge cost both in terms of time and effort that cannot be simply charged to their customers in Belgium.
Increasing domestic sales to compensate for lost EU sales isnt necessarily a solution, as Bennet explains. She says: We need to change domestic consumption habits, weening them off the big five; cod, haddock, farmed salmon, tuna and prawn, which make up 80% of all fish consumed in the U.K., while our European customers buy pollack, ray, ling, pout, lemon, megrim, etc. Eating a wider variety of species will make a difference, simply eating more will put further pressure on already depleted stocks.
The company has been approached by Chinese and Singaporean buyers in recent years, but has no interest in selling beyond the U.K. or Europe. I dont believe that international trade fits well into our sustainable business model, she says. Many want airfreighted fish, for example, which in my view is not sustainable.
Bennet believes that prices will inevitably rise to cover the extra costs of the paperwork, and fears that smaller operators will be deterred by this, leaving the trade of international goods to the larger, corporate brands. This is a huge loss for foodies, she says. Small scale operators of niche, artisanal produce will decide there is enough demand locally and give up selling abroad.
U.K. companies are also struggling with EU sales because of VAT management and other added costs that must now be factored into pricing and profit margins.
EU customers of British organic baby clothes retailer MORI are being asked to pay up to 60% additional costs to clear goods for delivery. The companys pre-Brexit 2020 revenue from EU sales was 1.5 million. Now, they are forecasting a potential 13% revenue loss until a long-term solution can be implemented, which could include setting up a third-party logistics (3PL) warehouse in the EU.
CEO and founder Akin Onal says: The practicality of establishing a warehouse in the EU depends on which 3PL partner we choose and the integration process. It requires a project team, budget and planning, and for a business of our size, an additional amount of resources and management time.
Such a move would eliminate the duty on sales for orders placed by EU customers, reducing costs, making prices more competitive, and increasing the growth potential for the business. The downsides, however, include the operational complexities associated with multiple warehouses, including making significant adjustments to stock management systems, reduced flexibility, and the need for extra management staff.
Establishing a warehouse in the EU is the only long-term solution that will allow us to truly be competitive in Europe, says Onal. If our customers continue to have to pay up to 60% in extra costs to clear goods for delivery then we continue to lose out to our EU competitors, and any marketing efforts and spend are hard to justify.
The U.K. government has described the challenges for exporters as teething problems that will be resolved. But as Sam Tyagi points out, while new processes always involve a learning curve, transitioning from a manual entry process based on an old archaic business model is more than just a teething problem. The answer, he says, lies in digital transformation.
Automation and AI can improve efficiency and increase collaboration between all supply chain partners, says Tyagi. Companies should follow the technology trend and digitize global trade activities. New processes can be easily implemented and maintained by utilizing technology.
KlearNow has developed an all-digital customs business network with a web-based platform through which exporters, importers, transporters, and agents can collaborate via a common tool, eliminating the need for the multiple parties involved to manually rekey data.
This kind of automation improves communication, simplifies data processing, and streamlines recordkeeping, while boosting the speed of export and import filings directly with customs authorities, says Tyagi.
The upside of all this is that the U.K. is also free to negotiate bilateral and multilateral trade deals independent of any EU influence, which could have handicapped opportunities in the past. Tyagi adds: Although there are shipping costs associated with moving products further around the globe, those costs may be offset by other benefits resulting from expanding into new markets beyond Europe.
More:
Can Technology Solve The Post-Brexit Woes Of British Exporters? - Forbes
- Its clearer than ever that Brexit has failed lets not inflict its miseries on young people - The Guardian - April 24th, 2024 [April 24th, 2024]
- 'I might as well stop and diversify into holiday lets' new research reveals the reality of farming after Brexit - The Conversation - April 24th, 2024 [April 24th, 2024]
- French bank to close dozens of Britons' accounts citing Brexit - The Connexion - April 24th, 2024 [April 24th, 2024]
- UK-US trade deal 'could be easier' with Donald Trump in the White House, says Lord Frost - Express - April 24th, 2024 [April 24th, 2024]
- Labour's Brexit conundrum - The Week - April 24th, 2024 [April 24th, 2024]
- Post-Brexit UK Risks Being 'Left Out In The Cold' As EU Coordinates Action On Shortages - Pink Sheet - April 24th, 2024 [April 24th, 2024]
- Brussels wants post-Brexit talks with UK on new youth mobility rights - POLITICO Europe - April 24th, 2024 [April 24th, 2024]
- Ravaged by austerity, chastened by Brexit: how can Britain have influence abroad when its broken at home? - The Guardian - April 24th, 2024 [April 24th, 2024]
- Sunak rejects offer of youth mobility scheme between EU and UK - The Guardian - April 24th, 2024 [April 24th, 2024]
- Brexit, austerity and how Labour could fix Britain - Tortoise - Tortoise Media - April 24th, 2024 [April 24th, 2024]
- NYSE considers 24/7 trading; Goldman Sachs moves senior banker to Paris amid post-Brexit overhaul - The Banker - April 24th, 2024 [April 24th, 2024]
- EU Delighted by Prospect of UK Labour Reneging on Brexit - The European Conservative - April 24th, 2024 [April 24th, 2024]
- Reverse the Brexit fiasco! - Workers' Liberty - April 24th, 2024 [April 24th, 2024]
- The writing is on the wall Starmer and Brussels will undo Brexit - The Telegraph - April 24th, 2024 [April 24th, 2024]
- UK to delay start of health and safety checks on EU imports report - The Guardian - April 24th, 2024 [April 24th, 2024]
- Journalist Asks David Cameron Outright If Rwanda Bill Is A Consequence Of Brexit - HuffPost UK - April 24th, 2024 [April 24th, 2024]
- 'We retired to Spain after Brexit and it's much cheaper - the UK seems miserable' - inews - April 24th, 2024 [April 24th, 2024]
- The EU would rather destroy the planet than let Brexit succeed - The Telegraph - April 24th, 2024 [April 24th, 2024]
- War heroes and Brexit: Why Greeks will always love the British - The Telegraph - April 24th, 2024 [April 24th, 2024]
- WATCH: Castletownbere fishermen to feature in documentary on impact of Brexit | Southern Star - The Southern Star - April 24th, 2024 [April 24th, 2024]
- Britons told their French bank accounts 'are being closed due to Brexit' - inews - April 24th, 2024 [April 24th, 2024]
- Post-Brexit border controls delayed again in the UK - hortidaily.com - April 24th, 2024 [April 24th, 2024]
- UK rejects mobility agreement with Europe to help young people travel and live abroad - The Independent - April 24th, 2024 [April 24th, 2024]
- EU proposing post-Brexit joint youth work and study scheme with UK - Sky News - April 24th, 2024 [April 24th, 2024]
- Brexit border checks will start from 30 April - Fruitnet - April 24th, 2024 [April 24th, 2024]
- Lord of the Rings star Dominic Monaghan says 'Brexit was a con' and urges others to take action - Manchester Evening News - April 24th, 2024 [April 24th, 2024]
- The EU has finally admitted it needs Britain more than we need it - The Telegraph - April 24th, 2024 [April 24th, 2024]
- The Brexit revelations: May's no-deal, a Canada plan and mating porcupines - The Times - April 24th, 2024 [April 24th, 2024]
- Italian citizens bank accounts frozen owing to shameful post-Brexit rules - The Guardian - December 22nd, 2023 [December 22nd, 2023]
- EU Policy. UK hails financial access deal with Switzerland after Brexit losses - Euronews - December 22nd, 2023 [December 22nd, 2023]
- Brexit: How the NI Protocol became the Windsor Framework - BBC.com - December 22nd, 2023 [December 22nd, 2023]
- EU Approves Three-Year Delay to Post-Brexit Tariffs on EVs - OilPrice.com - December 22nd, 2023 [December 22nd, 2023]
- Travel chaos is 'only going to get worse' when new EU fingerprint checks come in - NationalWorld - December 22nd, 2023 [December 22nd, 2023]
- British exporters call on government to ease post-Brexit trade frictions with EU - The Guardian - December 22nd, 2023 [December 22nd, 2023]
- Brits visiting Europe will have to give fingerprints under new rules - Metro.co.uk - December 22nd, 2023 [December 22nd, 2023]
- Ursula von der Leyen humiliated as UK forced major EU climbdown in Brexit car victory - Express - December 22nd, 2023 [December 22nd, 2023]
- Modern slavery a feature of care sector in England since Brexit - The Guardian - December 22nd, 2023 [December 22nd, 2023]
- US president Joe Biden ditches trade deal talks with Britain over fears of job losses - The Independent - December 22nd, 2023 [December 22nd, 2023]
- Brexit inflation: The role of trade policy uncertainty in increasing UK import prices - CEPR - December 22nd, 2023 [December 22nd, 2023]
- UK and EU Reach Accord on Post-Brexit Electric Car Tariff Postponement - IndiaTimes - December 22nd, 2023 [December 22nd, 2023]
- How are Brexit travel restrictions easing outbound and inbound? - The Independent - December 22nd, 2023 [December 22nd, 2023]
- Jeremy Hunt to strike post-Brexit banking deal with Switzerland - Yahoo Finance UK - December 22nd, 2023 [December 22nd, 2023]
- Britain was right to Brexit | MoneyWeek - MoneyWeek - December 22nd, 2023 [December 22nd, 2023]
- Brexit pain could be eased for Brits with homes in France - The Independent - December 22nd, 2023 [December 22nd, 2023]
- DUP talks about post-Brexit trading have ended, Northern Ireland secretary says - The Guardian - December 22nd, 2023 [December 22nd, 2023]
- Have voters cooled on the prospect of re-joining the EU? - UK in a Changing Europe - December 22nd, 2023 [December 22nd, 2023]
- Brexit will really start to bite us in 2024. How ready are you? - The Independent - December 22nd, 2023 [December 22nd, 2023]
- UK ditches company working time rules in further post-Brexit red tape cuts - City A.M. - November 8th, 2023 [November 8th, 2023]
- Sovereignty, economy, immigration: still the three pillars of the Brexit ... - UK in a Changing Europe - November 8th, 2023 [November 8th, 2023]
- Just because Brexit isnt on the frontpages, doesnt mean its settled - UK in a Changing Europe - November 8th, 2023 [November 8th, 2023]
- Post-Brexit EU clearing rules set for more relaxed approach - International Financing Review - November 8th, 2023 [November 8th, 2023]
- There's trouble in store for post-Brexit Britain - The New European - November 8th, 2023 [November 8th, 2023]
- SMEs feel the squeeze from Brexit - Financial Times - November 8th, 2023 [November 8th, 2023]
- Three years of polling on the Protocol reveals the depth of the new ... - Newswise - November 8th, 2023 [November 8th, 2023]
- James O'Brien on post-Brexit Britain: 'This conflation of patriotism ... - The Irish Times - November 8th, 2023 [November 8th, 2023]
- What's really behind GB News signing Boris as the voice of Brexit ... - Prospect Magazine - November 8th, 2023 [November 8th, 2023]
- Revealed: How Brexit and the Covid hangover are affecting the ... - Car Dealer Magazine - November 8th, 2023 [November 8th, 2023]
- Grayson Perry's portrait from the edge - The New European - November 8th, 2023 [November 8th, 2023]
- Bankers bonuses are back and the long 2010s dominated by Brexit ... - City A.M. - November 8th, 2023 [November 8th, 2023]
- Ports and truckers clash over post-Brexit border costs - Financial Times - September 17th, 2023 [September 17th, 2023]
- What would the UK look like without Brexit? - The New Statesman - September 17th, 2023 [September 17th, 2023]
- The long road of Brexit: A shifting regulatory reality - New Food - September 17th, 2023 [September 17th, 2023]
- Make-or-break moment looms for Northern Ireland's failed government - POLITICO Europe - September 17th, 2023 [September 17th, 2023]
- Barry Jones The Voice is our Brexit moment - The Saturday Paper - September 17th, 2023 [September 17th, 2023]
- Mark Carney Has Delivered A Stunning Takedown Of Brexit And Liz Truss - Yahoo Movies UK - September 17th, 2023 [September 17th, 2023]
- It's not just the 'Remainers' whingeing Britain really is broken - The Australian Financial Review - September 17th, 2023 [September 17th, 2023]
- UK SMEs not ready for 'avalanche' of Brexit 2.0 rules and taxes - Financial Times - September 17th, 2023 [September 17th, 2023]
- Brexit Bitterness Continues To Cloud Reporting The European Conservative - The European Conservative - September 17th, 2023 [September 17th, 2023]
- Green Brexit doesn't extend to pesticide protections - Footprint - September 17th, 2023 [September 17th, 2023]
- Theresa May says her Brexit deal was better than Boris Johnson's - POLITICO Europe - September 17th, 2023 [September 17th, 2023]
- Remainer UK civil servants were in tears over Brexit, top official says - POLITICO Europe - September 17th, 2023 [September 17th, 2023]
- Mark Carney Has Delivered A Stunning Takedown Of Brexit And Liz Truss - Yahoo News Canada - September 17th, 2023 [September 17th, 2023]
- More Brits than ever say Brexit was wrong choice: YouGov survey - Reuters UK - July 19th, 2023 [July 19th, 2023]
- Britain's fishing industry in line for post-Brexit boost following the end of EU red tape - Daily Mail - July 19th, 2023 [July 19th, 2023]
- Tabloids are misleading their readers over Brexit at their own peril - The Media Leader - July 19th, 2023 [July 19th, 2023]
- UK Support to Rejoin the EU Passes 50% for the First Time Since Brexit - Yahoo News - July 19th, 2023 [July 19th, 2023]
- Record Numbers of Brits Regretting Brexit, Survey Shows - SchengenVisaInfo.com - SchengenVisaInfo.com - July 19th, 2023 [July 19th, 2023]
- Almost two-thirds of Brits think Brexit has been a failure - The New European - July 19th, 2023 [July 19th, 2023]
- Five ways UK fashion industry can grow post-Brexit, Covid - just-style.com - July 19th, 2023 [July 19th, 2023]
- British companies start to grapple with 'Brexit 2.0' - Financial Times - July 19th, 2023 [July 19th, 2023]