Supply Chain: Your Brexit Competitive Advantage

Planning Your Post-Brexit Supply Chain

For over two decades, trade between the UK and the EU has been based on trade agreements that allow free movement of labor, goods, services, and capital. You now need to plan for a world where these trade agreements may be very different.

Managing a supply chain between the UK and the EU has been relatively straightforward, however, the UK’s vote to leave the EU is expected to bring large-scale change, with a range of challenges as well as potential opportunities.

Whatever the outcome of Brexit negotiations, it is wise to start that planning now, to ensure you remain competitive in the changing market. Early and effective scenario planning combined with analysis of the potential consequences of a post-Brexit economy might even improve your position. Many businesses are watching and waiting for signal or policy statements to inform their views on how the relationship between the UK and the EU will work in the future.

Recent speeches from the UK Prime Minister, Theresa May, made clear the UK’s intention was a clean break from the European Union’s single market – “a Hard Brexit” – with a willingness to leave the single market without a replacement deal in place, if it is better for Britain: “no deal is better than a bad deal”.

The specific mechanics of how this separation will work remain unclear. Will people be able to move between the UK and the EU as freely as they do now? Will different regulatory standards apply? Will potential trade tariffs significantly impact the bottom line? Will alternative Free Trade Agreements open new markets?

These are just a few of the many significant questions that supply chain professionals need to appreciate and understand.