Brexit report: insights on risks, challenges, and opportunities in global trade
Dec 12, 2017 Comments (0)
Every year, a compliance conference by AEB in partnership with the Chartered Institute of Logistics & Transport (UK) brings together consultancy firms, government representatives, solution experts, and business leaders from different industry sectors.
The event’s objective is to update business leaders on industry challenges, regulatory requirements, and on best practice for running modern and efficient global trade programmes.
This year’s conference took place on 11th October 2017 and highlighted developments under different Brexit scenarios, and the resulting impacts on global trade operations. Over 60 delegates from ten industry sectors shared insights on their biggest risks, challenges, opportunities, investments, as well as their current management of customs procedures, in an anonymous industry survey.
The results are very interesting indeed, particularly when compared with the 2016 survey – and they provide a valuable benchmark for traders in this tumultuous time. And the timing is perfect – with everybody in the middle of 2018 planning and budget discussions, the report delivers excellent prompts and ideas. So what are the findings?
In a nutshell, the biggest risk in global trade for our delegates was “No access to the EU single market”, which was cited by 62% of respondents (compared with 66% last year). In second place was “If the EU applies tariffs and quotas” with 57% (compared with 74% last year). The year-on-year comparison shows that businesses have now started to consider alternative sourcing options, and that they see little progress in the ongoing Brexit negotiations.
The highest-ranked global trade challenge was “Managing increasing complexity and pressure”, with “Managing expectations” in place 2 and 3 of the greatest challenges in 2017, respectively. Clearly, the ongoing uncertainty is taking a toll on businesses involved in global trade and is having an impact on business relationships and future planning.
In the key areas of opportunity and investment, 87% of delegates considered the implementation of appropriate tools a top priority. This is perfectly in line with both the challenge of digitisation and the severe skills shortage faced by the global trade and supply chain management sector. It also suggests increasing awareness of the importance and urgency of the right level of integration, automation, and flexibility to ensure business contingency and competitiveness in dynamic, global markets that are subject to constant change and uncertainty.
The report also includes an action plan template for traders, with check points for preparation that every company should have on screen to ensure different areas of their business are ready for significant challenges ahead, with a particular view to Brexit. We think that’s important because, while businesses’ awareness of the urgency to modernise global trade processes is increasing, not enough of them have started to prepare their operations for the challenges ahead.
With the expected massive increase in customs declarations for UK trade, it‘s crucial to have flexible and powerful IT solutions in place to be Brexit-ready. Forward-looking companies won’t wait for final post-Brexit trade agreements, they will implement the right solutions now and set-up a flexible supply chain to master current and upcoming changes in terms of sourcing alignments and customs procedures. Automating relevant processes and integrating powerful solutions into a business’s overall IT landscape are the basis for keeping a competitive edge and adapting to market changes.
Geoff Taylor is General Manager of AEB (International) Ltd in the UK and has been with the company since April 2017.