Paper and board importers are naturally concerned about how Brexit could impact their business. To make life easy for you we have pulled together the 10 most asked questions and answered them in this blog post.
BREXIT CHECKLIST DOWNLOAD: if you need our help please download our “10 things to consider pre Brexit” and request a free ‘Brexit Planning’ call.
1. Will deliveries take longer?
In reality no one can say 100% what will happen to the movement of goods when the UK finally leave the European Union. It is quite likely, at least in the short term, that delays to deliveries will be common and could lead to some big issues. We know ourselves of some mills that are refusing to supply to the UK in the initial period following Brexit, whilst this is unlikely to last more than a few weeks its effect will be quite profound. Ongoing we are unclear of what customs charges will be applicable, will there be extra steps required in bringing goods into the UK? for sure there will be extra documentation needed and more information than we currently provide. It is likely that this will cause delays as we all become used to preparing and filing the correct documentation in the required time period.
You can also download our Brexit Checklist, “10 things to consider pre Brexit” PDF for a quick guide on things to think about.
2. Will I have to pay customs charges?
It is highly likely that we have to pay some level of customs clearance charge, we will have opted out of the free trade agreement and whilst it seems unlikely that paper and board products will attract any import tariffs, we will have the extra costs of clearing goods through UK customs. Many UK based paper and board importers will be used to trading with countries outside of the EU, with South America and the Far East being such large suppliers into the UK, but there will be lots of people that will have never had to deal with such outcomes and need to make sure they are prepared.
3. What will happen with VAT?
What will happen with VAT is at the moment unclear, as many of the EU member states have different VAT rules it may be that nothing changes, it could even be lowered but lets not get ahead of ourselves. The Government have stated if the UK leaves the EU with no agreement, then there will be some specific changes to the VAT rules and procedures that apply to transactions between the UK and EU member states. The government has taken decisions and actions where necessary in order to mitigate the impacts of these changes for businesses.
4. Will I need to fill out more paperwork?
It is highly likely that the amount of paperwork and the details requested on that paperwork will increase. Procedures at ports of entry will change and although many of the container ports such as Hull and Felixstowe etc will be used to this level of paperwork, there will be others such as Dover that have mostly been involved in movement of goods from the EU that will not. It is likely that in the future much of this can improved with the development of new software but currently there will be a greater requirement for paper.
You can also download our Brexit Checklist, “10 things to consider pre Brexit” PDF for a quick guide on things to think about.
5. Will there be a material shortage in the UK?
It is highly likely that the amount of paperwork and the details requested on that paperwork will increase. Procedures at ports of entry will change and although many of the container ports such as Hull and Felixstowe etc will be used to this level of paperwork, there will be others such as Dover that have mostly been involved in movement of goods from the EU that will not. It is likely that in the future much of this can improved with the development of new software but currently there will be a greater requirement for paper.1. Will there be a material shortage in the UK?
6. Will manufacturers carry on supplying the UK?
As previously mentioned, EU suppliers could decide not to deal with the UK based purely on financial grounds. As well as the return per unit for the mills, having vehicles delayed at ports awaiting clearance for onward delivery into the UK they may decide that this is affecting their ability, due to lack of vehicles, to do deliver to other markets and to stop supplying to the UK.
You can also download our Brexit Checklist, “10 things to consider pre Brexit” PDF for a quick guide on things to think about.
7. Will price increases be imposed?
It seems inevitable that there is going to be pressure to increase prices. As outlined above it is likely that trading with the UK is going to be less convenient at best and at worst more difficult and less profitable. If extra costs are applied for customs clearance and other import/export charges then the price for raw materials will increase to cover these costs.
8. Will I be able to source from other markets?
There are numerous mature supply routes from outside of the EU into the UK and there is capacity in these countries to take up a shortfall in supply. The fact that many UK companies are not set up to be importers is the same for the scenario of the UK leaving the EU, you need the correct paperwork and documentation and not all have that. There is also the issue of distance, with these suppliers being based outside of the EU they are much further from the UK than those mills based in Europe. The reality is of 8-12 week deliveries, delivery of full container loads only and the requirement for far better planning in terms of producing final product which currently very few are set up for.
9. Will I be able to get round these changes?
In short no, when we leave the EU all of the above will be effective. In theory we could still decide not to Brexit but that is a completely different subject
10. Will I be able to continue to supply my customers in the current way?
Prepare, plan and talk to your customers. Read as much as you can about potential changes that will come with a soft, hard or no deal Brexit. Those companies that prepare and invest time planning will be best place to continue to serve their customers and give them the chance to win more customers.
BREXIT CHECKLIST DOWNLOAD: if you need our help please download our “10 things to consider pre Brexit” and request a free ‘Brexit Planning’ call.