2021 – Brexit and (hopefully) the aftermath of Covid19

With the uncertainty being faced by all businesses around Brexit in the UK – which has been further compounded during 2020 by the Covid19 pandemic – some warning realisations are now beginning to appear.

Like all major economies, the UK relies heavily on trade with the rest of the World. In particular, goods and raw materials sourced from Asia and the Far East are vital lines of supply for British Industry.

Already in October and November, we have witnessed the frustrations of importers facing delays in shipping – and now coming up to Christmas, many shipments due in during December, now being put off until January or February.

While these delays are real issues, the greater problem that will effect everyone is the exorbitant increases in handling charges at this time of year. Standard 40foot containers that have cost £1600.00 to ship, are now being charged at figures closer to £6000.00.

If, like Apple – you container is packed with high value smart-phones that retail at £600+ each – that hike in transport cost only adds a few pence to the product. Importing low-cost raw materials and parts however, can mean the costs of those materials will increase significantly – perhaps by 25% or more.

Why Import?

Many companies import simply because particular industries no longer manufacture in the UK. and have been priced out of the market here by more competitive overseas manufacturers.

Raw materials have always been imported. As an Island the UK does not have infinite resources and todays buying community requires more and more of many products that have to either be made overseas, or have raw material imported for conversion and fabrication.

In our industry, we are beginning to see a turn – especially where we are able to use technology to our advantage. However, we still rely heavily on imports of materials such as rubber and cork sheeting – just 2 base materials used for many gaskets and seals.

Unfortunately it looks like 2021 may not be the year of freedom promised by the Brexiteers here – but with rising unemployment and increasing costs, it could be another year we’ll wish to forget.

Lets hope not!

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