Time Machine - Five differences in Your Business in a post-Brexit world?
Time Machine - Five differences in Your Business in a post-Brexit world?
Negative Preparation is exercise where you predict forward a future date and review possible negative outcomes and decide what do we need to do now to prevent or minimise these negative outcomes.
Picture a scenario when Brexit is done, and the market impacts have happened. Your business has been impacted, in different areas and you can now focus on building your business again within this new world.
In July 2019, in a HMRC poll 57% participants answered, “Don’t know/haven’t thought about it yet”, when asked “Have you thought about how you are going to make customs declarations?”
The October 2019 many companies had started to put in an effort to be ready while many are still waiting I heard a story of a major manufacturer who invested heavily adjusting their supply chains and on internal processes for the February 2020 deadline. They then put a hold on further investment until some certainty on the deadline and the implications. The story is the same all across Europe and further, waiting for Brexit.
So, we magically transport to November 2020, and your business is different, post Brexit, in a number of ways:
1) You have lost cross-border Customers
Your customers are assessing their supply chains, and seeking to manage supply risks, compliance and costs and reviewing their options in the market.
• If you have customers on the other side of the EU/UK border how assured are they that your service to them will not be impacted?
• Will your costs increase to service cross-border customers, in customs filing administration and logistics delays?
• How are your competitors placed to win your customers in a post-Brexit world?
2) You have lost Customers in your local markets
For every company this is a time of evaluating supply chains and a time for opportunity for change.
Even if you have customers who are not on the other side of the UK/EU border, they may take this opportunity to re-evaluate everything. AND you can be sure that your competitors will help them.
3) You have new suppliers
As you evaluate your supplier risks and changing supplier costs, and delays, you have decisions to make to ensure continuity of service.
Suppliers on the other side of the EU/UK border have been replaced by local market suppliers.
Supplier within your current markets have been replaced as their service is no longer competitive.
As a business in the UK, you have reduced tariffs on imported goods from regions outside the EU, which introduces competition to your UK based suppliers.
As a business in the EU supplying into the UK, you have new competitors who don’t have EU import tariffs anymore.
4) Your Supply-Chains are simpler
The layers in some of your supply chains has reduced eliminating cross-border movement of goods, costs and delays. You may be paying more for materials in the back door to reduce the risks and logistics delays.
5) Customs Filing and Compliance is built-in to your Supply Chains
The change was the pain. Even though there were many challenges in the change, with the help of your team, consulting and IT systems providers, your business is better for it. You assessed using external customs brokers, but with the prices were only getting higher with such demand for their services.
You have put the effort into streamlining your ERP, Logistics Management, Transport Management or Trade Compliance systems, and you have integrated direct customs filing with self-customs filing for imports and exports.
After all the uncertainty of Brexit over the past three years, you are happy to be settling back into normal market challenges and focusing on making your business better. Yet, if you had your time again, there are a number of actions you could’ve carried out that would have made your business better.
Bringing yourself back to November 2019, with a hindsight and future knowledge what would you now do differently?