Brexit and logistics: A catalyst for change and innovation?

Following an exclusive survey of senior logistics and supply chain professionals from 80 multinational organisations in the UK and Germany, our Brexit white paper is now available to download.

An overview of the key findings

In the first half of 2018, we launched a research project aimed at understanding how companies were preparing their logistics for Brexit. Encouragingly, we found that businesses are making contingency plans, ahead of March 2019, however they desperately require clarity from Government to help them formalise these plans.

We found that 46% believe they will have time to prepare for Brexit (while just 18% believe they will not), but 50% still feel in the dark about the specifics of what is required. As one respondent commented: “Until we receive more guidance on the likely outcomes of trade negotiations it’s difficult to plan anything.” This seems to be a feeling across the board with four in five UK companies claiming to be less than informed about the potential consequences of Brexit.

What do manufacturers think about a ‘no deal’ Brexit?

Given the rapidly-changing political landscape, this summer we re-contacted many of the respondents from our original survey to assess how feelings have changed since the beginning of the year.

When it comes to a ‘no deal’ Brexit, we found that 79% say they have prepared, but they are ‘nowhere near ready’. The remaining 21% say they can’t prepare because so much is known; affirming again the need for clarity on the likely scenario post March 2019. With the prospect of WTO rules looming, it appears that companies have now shifted their focus squarely onto the issue of import and export with speed of delivery considered to be the number one priority post-Brexit, followed by ease of movement and import tariffs. This is a marked change from when we asked companies earlier this year, when speed of delivery ranked fifth.

Logistics innovation will be critical post-Brexit

What is encouraging from the research, is that many organisations are turning to innovation as a way of resolving many of the challenges Brexit could bring. We found that:

– Over a third (38%) of UK businesses plan to increase their need for better technology solutions, compared to just 18% of German companies
– Nearly a third (30%) of UK businesses say Brexit has prompted their business to be more innovative with solutions
– 44% of UK manufacturers foresee an increase in logistics spend post-Brexit.

But what if we don’t get clarity soon?

With so many Brexit options still on the table, the important thing for companies to do now is acknowledge that a ‘hard’ Brexit is a very real possibility. It’s also important to not ignore the situation!

Our research has shown us that 35% of UK and German companies are not preparing for Brexit because so much is unknown. However, history has taught us that digitalisation is often the key to maintaining and improving services, even within challenging circumstances. With that in mind, companies shouldn’t rest on their laurels and instead they should get themselves prepared, so they are able to adapt quickly to market needs and take advantage of new opportunities as they present themselves.

How can your logistics provider help with Brexit?

As well as assessing your own processes, getting ready for Brexit also means expecting much more from your logistics provider. Post-Brexit it will be increasingly important for logistics service providers to step-up to meet these changing demands, with the priority being on providing the right technology systems, flexible network options plus economies of scale. All three will be vital in a post-Brexit landscape so start having those conversations now so you’re prepared with the support you might need too.

For more information on how Carousel can help support you in the run up to Brexit, book a meeting with one of our experts by emailing us here.