Brexit and the impact on the eCommerce supply chainBlog
November 10, 2021
When talking about post-Brexit news, we have often focused on the main regulatory changes that Britain's exit from the European Union brought with it. This time, however, we want to examine how the new rules impact the supply chain of brands that want to sell online cross-border in the UK (but also from the UK itself to EU countries). Let's take a look at the updates on Brexit in this respect, the main business areas that are directly impacted by the Brexit rules and how this represents a real make-or-buy challenge for brands and their supply chain.
Duties and tariffs will undoubtedly affect the supply chain of brands selling cross-border online. The best thing to do is to talk to your suppliers about how the new regulations will affect production times and other aspects of the supply chain. After this discussion it may be necessary for brands based in EU countries that want to sell in the UK to revolutionise their strategy, considering the possibility of finding a supplier based in the UK to keep the business running smoothly there. The same argument, although more complicated, can apply in reverse for companies based in the UK who want to sell in the UK. Even for them it may be advantageous for some extremely profitable markets to think about relying on local suppliers.
The introduction of customs for shipments to and from the UK has an incalculable impact on shipping times. Not knowing how long your goods will be held up at the checkpoint can be a major challenge. Depending on the volume of trade and the size of the business it may be worth considering spreading your inventory across multiple warehouses in the EU and the UK – this will allow orders to be fulfilled from the nearest domestic retail fulfilment centre and prevent delivery times from becoming even longer.
As with warehousing, for a brand working with cross-border eCommerce it may be essential to consider having a logistics centre in the EU if the business is based in the UK, or in the UK if the business is based in a country within the EU. This allows orders to be processed quickly and without interruption in the respective regions. This way, and this is particularly valid for UK-based businesses that want to sell in the EU, it will be easier to expand into the EU market without having to manage cross-border shipping for every order destined for the EU.
Make or buy, that's the dilemma
So there is a new challenge for cross-border eCommerce brands post-Brexit. There is no one-size-fits-all solution, but there is no doubt that you need to consider how managing the regulatory complexities impacts on your business and whether you need to rely on, for example, a partner who can deal with all these complexities.