Responding to news that British store chains are suffering from severe supply chain issues on the European continent, Dr Virginia Spiegler, Senior Lecturer in Operations and Supply Chain Management at Kent Business School, explains how this came to be:
‘Supply chain operations are so complex that they made a free-trade deal actually cost money. This is because before 1 January 2021 the UK not only traded freely with the EU, but was part of the Customs Union. Leaving the latter added two new obstacles that UK-EU supply chains were not used to dealing with: bureaucracy and paperwork.
‘Completing paperwork and managing bureaucratic processes require time, and time is money. Therefore, UK companies exporting to the EU are facing delays and extra costs. Empty shelves are a result of longer lead-times and suspended logistics services caused by red tape.
‘For sure, most business will get used to the bureaucracy and logistics companies will eventually process paperwork quicker, but the extra cost will remain.
‘So the question many exporters should ask themselves is: “are my products still financially profitable to export to the EU?”’
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