Brexit logistics

How will Brexit Impact Logistics Companies?

With Britain’s exit from the EU single market and customs union a matter of days away and no trade agreement still in place, there are a number of steps that logistics companies should be taking to prepare.

Brexit is set to make a high impact on the sector, due to the amount of cross-border travel involved. The most troublesome Brexit issues relevant to the industry are delays at ports, mandatory border checks and ability to process the required paperwork. These issues are being tackled alongside increased costs to keep up with technical innovation and increased customer satisfaction demands. The only way for logistics companies to stay ahead are to prepare for changes and the ability to adapt quickly to changing legislation.

 

What Does Brexit mean for Business?

As the 31st December approaches, UK businesses are increasingly anxious about their prospects with many losing faith about their future. Many businesses have taken to stock piling essential goods to ensure they are not reliant on orders arriving within a certain time period. In light of this, freight forwarders are bracing themselves for a negative impact on trade between the UK and the EU that will undoubtedly affect them from a customs, bureaucratic and economic standpoint, providing the UK goes ahead with a no-deal withdrawal. Without a deal, Brexit will severely impact the movement of freight in and out of the UK whether it be via road, sea, air or rail. Here’s how it is likely to impact each mode of transport:

 

Road

Once the UK exits from the freedom of movement agreement with the EU; UK registered vehicles will be required to apply for international driving permits. The European Conference of Ministers for Transport (ECMT) permits are required for laden and unladen journeys through EU and EEA countries. If the UK cannot negotiate a deal with the EU, an ECMT permit will be required for every journey made. These permits are issued on a limited basis which will severely impact the frequency that UK hauliers are able to cross the border. EU drivers will continue to be allowed to drive in the UK on their licences; however, this is only for a temporary period.

 

Air

UK carriers will see their cargo services between EU and third countries capped at 2018 flight frequency levels which will restrict a company’s ability to opt for air travel to transport their shipments to avoid delays at sea ports. As well as this, UK carriers will also be unable to transport goods between two third countries and stop in an EU country or fly between two EU states severely restricting routes and the efficiency of their operation.

 

Sea

UK companies that are dependent on shipping routes between the UK and EU are likely to face issues with cabotage if no deal is struck between the two unions. For the UK to transport goods to a port within the EU, that individual state will need to extend their cabotage rights to the UK. So far, this is possible in Ireland, Belgium, The Netherlands and Denmark. Without a deal an individual agreement with each EU member state will need to be struck before routes can be resumed causing significant restrictions for UK sea freight companies and imposing on their efficiency.

 

Shipping companies carrying passengers and trucks, from the UK to the EU will be required to submit additional security information to the port before entering. This additional information will likely be required to be submitted before travel and by the people using the services so that the shipping company are able to comply with procedures. This requirement can be waived between EU countries but not for non-EU countries attempting to enter an EU country. Ensuring that shipping companies adhere to this new procedure will require extra training and a requirement to notify their clients that additional information will be required. All of this will require time and money at the shipping company’s expense and could potentially lead to reduced loads.

 

Delays at the Border

The UK government have estimated a 6-month disruption period at the UK border, with the worse period being the first 3 months. This has been put down to: additional time needed to conduct extra checks and not having the required space at present to do this, the prediction that drivers will not have the required licences and permits and the assumption that inexperienced traders will not have the correct paperwork.  The government have announced a transitional period where the new procedures will be simplified to mitigate delays; however, this has not been reciprocated by the EU and drivers could face delays when entering an EU member state.

In order to minimise their delay at the UK, it is being recommended that logistics companies familiarise themselves with the documents that they will be required to complete and the paperwork that will need to accompany the shipment. Recipients of goods shipped across a border should expect a duty payment to be made. Failure to do this before the shipment crosses the border could incur fines and the goods being seized until the necessary fees are paid. Customs fees and paperwork should be prepared in advance will save businesses extra money and time; both of which will be critical moving forward.

low tariffs after brexit

Brexit and the Logistics Industry: Infiniti Research Outlines Key Challenges

Well known market intelligence company, Infiniti Research have announced completion of an article on their website outlining what they expect the key challenges of Brexit will be on the logistics industry.

The deadline for the UK and the EU to negotiate a trade agreement is set to end on the 31st December.  With the deadline a matter of weeks away, no deal has been struck and it is looking likely that the UK will no longer have access to the single market and customs union. Due to the high amount of cross-border movement within the sector, this will undoubtedly impact the logistics industry in a significant way.  According to Infiniti, Brexit is likely to have severe consequences to even the big logistics companies. One significant example of how troublesome Brexit is set to be is through the importation of Britain’s petroleum. At present, over 25% of this commodity passes through the EU before arriving in Britain. With no access to the single market and customs union, a tariff will be applied on this product as it leaves the EU and enters the UK. The extra expense will have consequences on Britain and the EU as those extra costs trickle through the markets.

 

Brexit and the Top Challenges

Infiniti’s article outlines the following as the logistics sector’s top challenges as the UK leave the single market:

Reduced Trade

In 2019, 43% of the UK’s exports went to the EU which equated to £294 billion whilst 53% of the UK’s imports were from the EU. With the UK set to not have access to the single market, a rise in tariffs will discourage trade between the EU and these numbers will inevitably decrease. With EU trade, making up such a large percentage of the UK’s total imports and exports, this will undoubtedly make a huge dent in the country’s GDP.

Border Control

As free movement between the UK and the EU ends, tighter border controls are set to be put into place creating barriers for trade on either side. The UK government has warned of a 6-month disruption period with the worst of it being during the first 3 months. This will mostly be down to additional checks being introduced and the expectation that at the beginning drivers will not have the correct licences and shipments will not be accompanied with the correct paperwork. In an attempt to mitigate these delays as best they can, HMRC have announced there will be a period of leniency for the first 6 months where the new procedures will be simplified. The disruption to the border is already having a knock-on effect on the logistics industry. With businesses predicting delays in supply chains, they have taken to stock piling essential goods. For UK logistic companies, delays in the border will mean a decline in efficiency and potential problems with administration if the correct paperwork and customs fees are not paid.

Migration Control

Another potential problem that Infiniti has outlined will be stricter controls on migration with particular emphasis on EU workers. With freedom of movement coming to an end, citizens of EU states will no longer have the right to work in the UK and will need to apply for the necessary work visas.  This will translate to less EU workers working for UK companies. Road haulage is set to be majorly impacted by this, as the sector relies on drivers belonging to other EU countries. Additionally, drivers with UK licences will be required to apply for an international driving permit to transport goods within EU states. These permits will need to be issued for every journey that is made and they are capped in amount. This alone will significantly import the number of times UK drivers will be able to transport goods. Drivers with EU licences will be able to continue to use their licences in the UK but only for a temporary period.

Increase in Operating Costs

With no trade agreement in place with the EU, the cost to import fuel into the UK will rise which will impact on the price consumers pay at petrol stations. This along with added tariffs and duty payments that will need to be handled, managing shipments is going to become considerably more expensive than it was whilst the UK was in the single market.

 

Prepare for the Worst

Due to lack of direction from the government and the ongoing issue of the COVID-19 pandemic, logistics companies have been slow to prepare for the looming deadline of 31st December.  Businesses are being urged by experts to not, “sit on their hands and hope for the best,” and to instead do the research themselves to ensure that they know what is expected of them. Holding out for a trade deal at this late stage is wishful thinking and will be detrimental to businesses going forward. The UK government are urging companies and their affiliates to start preparing for the new legislation, understand what is required of them and to ensure that their associates are updated.

warehouse

Post Pandemic Warehouse Automation Market poised for Long Term Gains

An updated report by international market research provider, Interact Analysis, suggests that the warehouse automation market is set to make long term gains into 2023. 

Despite many industrial sectors suffering major losses as a result of the pandemic, COVID-19 has driven more people to turn to online shopping giving the sector a boost which is set to last well after the end of the pandemic.  This is causing warehouse managers to increasingly resort to automation solutions to provide a more efficient, productive and socially distanced working environment on the shop floor.

 

A Closer Look at the Numbers

Due to COVID-19, revenue for 2020 will continue to depress as completion dates for projects are pushed back to next year; however, the sudden surge in online shopping has caused a significant increase in order intake.  The second quarter order intake for Dematic has doubled compared to the same quarter in 2019, with the company planning to hire 1000 new staff by the end of the year.  In addition to this, the market size of the automation sector is set to be 6% larger in 2023 than pre-pandemic forecasts.  Although a lot of sectors such as manufacturing and apparel are predicted to see a drop in their market share – a combined decrease of $600m – the general merchandise and groceries are expected to make up for this fall, driving a significant overall net increase in the warehouse automation market.  Data from the report puts that increase at a combined market value of $3.5bn higher than pre-pandemic forecasts.  As a result of this, supermarket chains are now investing in their own warehouse automation.  With contracts to manufacture 38 automated warehouses by the end of 2025, Ocado are set to become one of the leading warehouse automation providers.

 

Software Revenues Under Threat

Another important finding from the report is that warehouse automation software revenue seems to be under threat.  An explanation for this is the growing trend among online retailers to bring warehouse execution and management software in-house.  Companies like Amazon, Alibaba and JD.com have been leading the way in this trend and other retailers are starting to follow suit.  As a result of this, we could see the market price of automation software commoditised forcing multiple systems integrators to tender bids for solution designs.  Research is suggesting that more innovation is required to suit specific sectors which off the shelf software is not providing.

Interact Analysis’ lead analyst for warehouse automation, Rueben Scriven says:

“The warehouse automation world is on the move. COVID-19 has devastated high streets and shopping malls, but there are already signs that eCommerce retailers are preparing to step in, with grocery retailers taking advantage of disused sites to augment micro fulfilment centres onto existing stores, bringing the fulfilment process closer to the customer, and attracting customers and jobs back in to the high street.  When it comes to the issue of automation software development moving in-house, we found that only the grocery sector will likely continue to heavily rely on existing integrator software solutions.  The way forward for warehouse automation vendors supplying online retailers is to increase their ability to tailor their software offering to individual customers.”

 

logistics-city

“Don’t Expand Congestion Charge,” Logistics UK plea as Government threaten to recoup TFL Losses

Logistics UK, a business group representing the logistics sector, made a plea to Rt Hon Grant Shapps MP, the Secretary of State for Transport, to outline the serious concerns they had regarding the then-proposed plans to expand the congestion charge. 

This plea came off the back of the Mayor of London, Sadiq Khan coming under pressure from Boris Johnson and other ministers telling him to make an expansion of the £15 a day congestion charge to the North and South circular roads, scrapping free travel for older and younger Londoners, and increasing TFL fares by more than previously agreed in return for a bailout package for Transport for London.

 

David Wells, Chief Executive of Logistics UK had this to say on the matter,

“Logistics UK is urging the government to refrain from including an expansion of the London Congestion Charge as a condition of Transport for London’s financial bailout package; logistics businesses continue to struggle financially and operationally as a result of the Covid-19 crisis and this additional burden would be a significant blow to the recovering logistics sector.  With little alternative to using lorries and vans to keep the capital’s businesses, schools, shops and homes stocked with the goods and services they need, these changes amount to a tax on deliveries and would therefore have little effect on commercial vehicle movements.  Instead, it would simply increase operating costs for those charged with delivering to meet the capital’s needs, including supporting the vulnerable and those self-isolating with home deliveries during this difficult time.”

 

Fortunately, Sadiq Khan has managed to secure a deal in the eleventh hour that sees the proposed expansion of the congestion charge scrapped and has secured an agreement with the government on a £1.8bn funding deal to keep TFL services such as busses and tubes running until March 2021.  Khan has been seeking a £4.9bn settlement for the next 18 months to keep public transport in London moving after the revenue collapse that Covid-19 brought with it.  Last month, Boris Johnson said that TFL were, “effectively bankrupt,” before the global pandemic began and blamed the London Mayor for the transport systems financial situation.  TFL defended Khan, saying that he had inherited a £1.5bn deficit from when Johnson, himself was Mayor.

Khan explained that although the agreed £1.8bn deal was, “not ideal,” he did add that, “We fought hard against this government which is so determined to punish our city for doing the right thing to tackle Covid-19.  The only reason TFL needs government support is because its fares incomes have almost dried up since March.”

Khan initially rejected the proposal from the government saying that it would have affected more than 4 million more Londoners.  He successfully defeated this proposal and all other proposals made against TFL in exchange for the bailout; however, the prices on fares will increase by RPI+1% in January as previously agreed.  Despite the Mayor’s success in defeating these proposals made by the government, another financial agreement will need to be negotiated prior to next year’s mayoral election.

Sadiq Khan also said that, “These negotiations with government have been an appalling and totally unnecessary distraction at a time when every ounce of attention should have been focused on trying to slow the spread of Covid-19 and protecting jobs.

The pandemic has had the same impact on the finances of the privatised rail companies as it has on TFL and the government immediately bailed them out for 18 months with no strings attached.  There is simply no reason why the same easy solution could not have been applied to London, which would have allowed us all to focus on the issues that matter most to Londoners, which are tackling the virus and protecting jobs.

I am pleased that we have succeeded in killing off the very worst government proposals.  These proposals from the government would have hammered Londoners by massively expanding the congestion charge zone, scrapping free travel for younger and older Londoners and increasing TFL fares by more than RPI+1.  I am determined that none of this will now happen.”

 

 

low tariffs after brexit

Cabinet Minister Sparks Backlash Over Brexit Transition

A cabinet office minister, has prompted a furious backlash among business associations, after accusing them of, “having their heads in the sand,” in preparing for the transition that will happen when the UK leaves the single market and customs union on 31st December.
Theodore Agnew, the cabinet minister working on preparations for Brexit within the Treasury and Cabinet office, believes that firms have been too slow in preparing due to the impact of the coronavirus and the recession that has accompanied it. He has urged bosses to become, more “energetic,” in their approach of getting ready for the final stage of Brexit.

Lord Agnew’s Comments

In an address to the Treasury Committee, Lord Agnew said, “There has been a head in the sand approach by traders which has been compounded by what I would call the quadruple whammy of two false alarms, so two extensions at the very last minute, then followed by Covid, and now followed by the recession. The traders are not as ready as they should be.
“And if there’s one headline I hope that comes out of this appearance today it’s to send another shot over traders’ bows to warn them that it’s their businesses that are at stake from January 1 and they really must engage in a more energetic way…… Ultimately the government can only do so much. If businesses haven’t engaged in the process and understood the processes from 1st January that has to be their responsibility.”
Business Backlash
The minister’s stark warning has drawn a disgruntled response from businesses that have repeatedly called for clarity and urgency from the government on what the new border processes and IT systems will look like, many of which are still not in place. Among those to speak out over the minister’s comments were Tim Rycroft, Chief Operating Officer of the Food and Drink Federation. “A ‘head in the sand approach by traders’? That’ll go down well!” This was also backed by Stewart Wood, a Labour representative of the Lords EU committee who described Lord Agnew’s comments as a, “spectacularly unfair characterisation.”

As well as the comments that he has made on business readiness for the Brexit transition, Lord Agnew also came under fire from the Road Haulage Association (RHA) by announcing that he was more interested in talking to groups that were more, “integrally involved” in cross-border trading rather than the haulage group, who have been key in highlighting the government’s shortcomings in preparing for the transition.

Richard Burnett, RHA’s chief executive, responded, “It’s clear that Lord Agnew doesn’t understand how the logistics industry works and that hauliers will have to provide the full service of customs declarations as well due to the shortage of agents. Of course he can leave us out and ignore us, but at his peril.”

Logistic UK’s Response

The response of Elizabeth de Jong, policy director for Logistics UK, made little comment to Lord Agnew’s direct comments and instead took this as an opportunity to detail Logistic UK’s approach to the transition.

“Rather than ignoring the UK’s upcoming departure from the EU, Logistics UK has been proactively urging its members to make sure that they and their customers prepare as much as possible for the new trading conditions we will face. Like the government we are also calling on the wider business community – the importers and exporters across the UK – to engage with the detail and get ready for January 1st.”

“Instead of spending the ne next 11 weeks before the end of the transition period debating who and what is or isn’t ready, Logistics UK is proactively working with government on a series of metrics to assess readiness, so that government and industry can be as confident as possible that all is on track for a smooth transition to a new trading agreement with the EU. Despite the challenges our members are facing to cope with the COVID-19 pandemic and the festive season, traditionally our busiest time of year, we stand ready to help keep Britain trading as we always do.”

HMRC has predicted that 260 million new customs declarations will be completed per year which would require an extra 50,000 new customs agents.

Relaxed Brexit Border Infrastructure Welcome but Not Enough Warns British Ports Association

On 24 September a new development order was applied, in named areas of England, relating to the requirement to check and process vehicles on entry into the United Kingdom as well as facilities for drivers and border staff. The order gives specific government border departments such as HM Revenue and Customs (HMRC) and the Department for Transport (DfT) the ability to apply to the Secretary of State to add infrastructure to its ports which will prove beneficial once the UK break away from the Single Market and Customs Union.

Approval by the British Ports Association

This order has been welcomed by the logistics industry, including the British Ports Association (BPA); however, they warn that there is still more to be done before the transition deadline. Richard Ballantyne, chief executive of the BPA said, “The legislation introduced to bypass the planning processes for border infrastructure in England is certainly a welcome move; however, there is still a lot be done to get ready for 2021. At various stages next year, new customs and border control processes will be introduced on European trade and our ports are working with the government to look at what needs to be done.”
He added that he hopes for a swift roll out of the government’s infrastructure plans, in-order that the UK’s gateway to Europe be ready.

The preparations have begun to create a physical and digital infrastructure to facilitate customs and other border procedures during transit between the UK, Europe and Northern Ireland. This could include new inspections facilities and computer systems to manage border controls that have emerged, following Britain’s exit from the Single Market and Customs Union.

Ballantyne said, “the sensible and measured implementation of the new border requirements could be essential for all parts of the freight and logistics industry.”

This order comes after a concerted effort by the Road Haulage Association and key figures from the logistics industry urged the government for a meeting over Brexit amid concerns over the slow progress that was being made.

The BPA represents 86% of port traffic in the UK, which includes major gateways such as Birkenhead, Dover, New Haven, Pembroke and Tyne. These facilities support the transport of thousands of trucks and trailers on a daily basis between Europe and the UK. This part of the industry could have the biggest impact on the new processes that are included in the new order.

Drawbacks to the New Order Identified

Following on from this, planning law expert of Pinsent Masons commented that the powers granted by the new regulations were limited to smaller developments which would not require environmental impact assessment (EIA). He explained that the development would not be able to approve new motorways or express roads over one hectare nor motorway services over 0.5 hectares unless it is proved that they will not have an untoward impact on the environment. He surmised that, “realistically…. The new order will apply to more modest changes in and around the ports.”

“Proposals must be put forward by a relevant border department – for example, HMRC – with the site owner, such as the harbour authority, only engaged on the application. Presumably, in practice, it is likely that the border department will have discussed things at length with port operators, as it is difficult to see how the border department will be best placed to lead on the necessary infrastructure to process port traffic efficiently through the port and surrounding areas.”

Heathrow Cargo

Why is Air Cargo seeing an increase since COVID-19?

According to CLIVE data services, air cargo volume saw a 12% increase in the last week of June compared to the last week of May. Niall van de Wouw, managing director of CLIVE, explains this increase was initially due to the urgent requirement of personal protective equipment (PPE) needed by governments in an attempt to contain COVID-19. Despite the international demand for PPE now beginning to diminish, Van de Wouw is confident that air cargo volume will continue to rise month on month.

“Our June analyses seems to suggest the first steps towards a structural market recovery. Despite the decreasing demand for PPE in June, we still see that the volumes increased over May. We are starting to see a more recognisable airfreight market following more logical economic principles and more logical rates.”

There is no denying that aviation has been one of the industries hit hardest by the COVID-19 pandemic. Government restrictions have prohibited entry for travellers causing ticket sales to plummet, reduced schedules and redundancies for airline staff. An increase in air cargo volume is a glimmer of hope in what has been a dark time.

How has COVID-19 impacted Air Cargo Volumes?

A number of sources have submitted their findings on how the global pandemic has affected air freight including; Veritas Global, Seabury and The International Air Cargo Association (TIACA). Alongside this, the International Civil Aviation Organisation (ICAO) have also done their own studies, which are updated and shared on a weekly basis. Despite the sheer number of agencies looking into this there continues to be a lack of reliable data but what does stand out is the following:

• Global air cargo capacity is down 35% from 2019
• 20% of belly cargo continues to fly
• Freighters capacity is showing signs of stabilising

Due to the current restrictions of passenger travel, airports are seeing a sharp decrease in their revenue forcing many to close. Despite full closures to passenger traffic, a share of airport and airside infrastructure must remain open to support air cargo which comes at a cost to a weakening cash supply.

How is TIACA Supporting the Industry?

TIACA believes that it is their permanent role to promote the air cargo industry. During the outbreak of the coronavirus, they have focused their efforts in reminding governments how important the role of the air cargo industry is to the global economy, international trade and in battling the devastating effects of COVID-19. The value of air cargo has been highlighted during the pandemic as without it the transportation of valuable medical, PPE and food supplies would not have been possible. As COVID-19 looks set to continue its impact on the world, so will the demand for medical supplies. It is vital that delivery services are able to keep up with this demand.

How have Cargo Operations Changed Due to Coronavirus?

Changes to cargo operations to mitigate the impact of coronavirus include:

• The use of passenger aircraft
• Expanded use of charter flights
• Changes in flexibility to certain regulations
• Introduction of new standard operating procedures
• Increased protection for staff

The implementation of these new operations and assessment of how effective they are is a time-consuming process and is changing everyday as we learn more about the novel virus. TIACA and other aviation organisations are pushing an initiative where a working document is created for a post COVID-19 recovery path. The main focus of this document is to suggest short, mid and long-term solutions to the issues caused by the pandemic so that the industry as a whole can recover.

What can the Industry do to Prevent this Impact from another Pandemic?

When industries such as aviation rely on governments from all over the world to collaborate and work cohesively, there needs to be a concerted effort to make things consistent. A standard that extends from one end of the world to the other.

It is clear that the implementation of new procedures to prepare ourselves for a future crisis are required; particularly, relating to health and safety in the workplace. Emergency plans will need to be drawn up and implemented to ensure that if another pandemic were to occur that industries would have systems in place to mitigate the effects that were able to destroy everything so quickly and in such a short space of time. This will involve analysis, risk assessments, training sessions and re-writing standard operating procedure. For aviation in particular, more consideration needs to be given to air cargo and how we can keep operations going in the face of a crisis. The air cargo industry has proved invaluable during the COVID-19 pandemic; however, more support needs to be given to be able to provide that invaluable service in the future.

Advice on Exporting your Car from the UK

For some, exporting their car from the UK can seem like a daunting task that can potentially put people off the process. Deciding on how long your car will remain outside of the UK will determine the documentation that you use as well as the declarations you make to the UK and overseas customs officials. The following information covers the most common eventualities of exporting your car from the UK and advice on completing this process.

Permanent Export

If you are planning on exporting your vehicle from the UK permanently you must inform the DVLA. If you are the registered keeper of the vehicle, this can be done by completing section C of the V5 Registration Document that accompanies your car. Once this is received, the DVLA will send you the Certificate of Intended Export (V561) as a confirmation of your car’s registration. Alternatively, if you have a Registration Certificate (V5C) this can be done by completing and sending the purple section of the document (V5C/4). It is important that you have your Registration Certificate with you when you arrive at your final destination so that you can present it to the relevant authority when the vehicle is eventually registered abroad. If you require any further information, this can be found by contacting us or by logging onto the GOV.UK website.

Temporary Export

If you plan on taking your car out of the UK for less than 12 months you must ensure that you take either your V5 registration document or V5C registration certificate with you. If you have lost your copy, you must inform the DVLA by completing a V62 form. It is important that you apply for this document well in advance of your departure, as your replacement Registration Certificate may take up to 14 working days to arrive and even longer if you are not the registered keeper. Please ensure that you have sent the correct fee for this service and have met domestic and international requirements relating to licensing and taxation of the vehicle.

If you are taking your car out of the UK for a limited time only, you may wish to apply for a Carnet de Passage to avoid paying a deposit to customs officials at your final destination. If you intend to obtain one of these you are advised to apply for it in advance of travelling as it can take well over a month for the process to be finalised.

If you are using a freight forwarder or logistics company, you can normally ship your vehicle without the need of a certificate; however, having this in your possession will significantly reduce your chance of delays at the UK border.

Essential Tips

Besides notifying the DVLA, there are some additional tasks that will be beneficial to complete prior to your departure. These are listed below:

• Documentation – Besides the V5/V5C document mentioned previously, you are advised to carry your valid driving licence, a form of photo ID and the vehicle identification number.

• Keys – Ensure that you carry your extra set of keys for the vehicle.

• Fuel Tank – Fill the fuel tank to at least a quarter full.

• Antifreeze – Due to the potential harsh conditions that your vehicle may be exposed to during transit, it is advised to apply antifreeze and, in some situations, rust protection.

• Vehicle Condition – Thoroughly clean the vehicle inside and out in preparation for checks that will be made on the car. Ensure that the car is in good working order unless otherwise specified.

• Personal Items – Make a list of all personal items left in the car to check off when you reach your final destination.

• Additional Preparation – Disable security systems, remove GPS, stereos or any other portable equipment, remove antennae and fold wing mirrors back.

Vehicle History

If you are not in possession of a valid export certificate, customs officials may check if your car has any outstanding finance payments left on it. This is particularly common with new or high value cars. If they discover that it does, they may not grant you permission to cross the UK border without written permission from the finance company. Checking this information before you travel will significantly reduce delays at the port.

International Duty and Tax Requirements

A good freight forwarder will be able to ship your vehicle to anywhere in the world; however, you may be liable to pay import taxes and fees when it arrives. Whilst most freight forwarders can assist you with this, it is your responsibility as the owner to adhere to any import requirements and regulations that the country you’re travelling to requires. Failure to do so may result in expensive fees, delays and potentially the confiscation of your vehicle so it is important to check this before you depart.

Logistics Solutions for a Post Covid-19 World

In four short months, the COVID-19 pandemic has brought the world’s economy to its knees and changed its course forever. The aviation industry with particular emphasis on cargo has been one of the key industries to suffer and will need to act fast in order to adapt and recover from its losses.

Business owners are having to make some tough choices in order to survive the ‘new normal.’ As we speak, companies are introducing new policies to alleviate the impact on supply chain and to maintain its profitability. If you are a business owner looking to regain your footing in your industry post-COVID, read on for the current methods companies are adopting to survive:

1. Higher Inventories

Due to the global pandemic, many businesses with stretched supply chains and low inventory levels were severely impacted. As a result of this, we will see many companies choosing to maintain higher inventories to mitigate the issues that have arisen. Industries that have specifically benefitted from this include those that are dealing in critical goods such as pharmaceuticals. Although this measure requires a higher amount in capital, it is thought that consumers will favour businesses that show a more resilient and sustainable approach therefore increasing demand and profitability.

2. The End of Single Sourcing

With trade tensions rising between China and the rest of the world, we are now seeing a decrease in single sourcing. Companies are now looking to reduce their dependence on China and are seeking alternative countries for their supplier needs.

Returning to pharmaceuticals, many drugs are manufactured in China and India due to low costs. China alone supplies 80% of the worlds active ingredients contained in antibiotics; however, this is likely to change due to the relaxing of EU patent laws. In the past, this law has provided a 20-year protection on any drug produced there and has encouraged many companies to produce drugs outside of the continent. The new changes potentially make Europe a much more attractive place for pharmaceutical production and we could see a lot more production taking place as a result of this.

There is a possibility that global health insurers may impose quotas, including products and ingredients from specific suppliers, which could also mark the end for single sourcing. Despite this, a large amount of non-generic drugs will continue to be made in China and India due to costings, particularly if the countries have a vast quantity of safe stock and have the capabilities of mass-producing critical medicines.

3. Business Travel Reduction

Key business changes such as remote working and video conferencing, that assisted employees during lockdown, look set to become the norm for previously office-based workers. With this in mind, business travel undoubtedly will experience a steep decline with a knock-on effect to industries such as automobile manufacturing, as less people feel the need to buy a car. This decline will have a considerable impact on global economies with Europe alone, depending on car manufacturers for 10% of their overall revenue. The industry was already suffering with the recent developments in electric car manufacturing which requires fewer parts from a combustion engine, this coupled with the disruption to the supply chain spells bad news and their monopoly in the transport world looks set to end.

On a positive note, e-commerce businesses will emerge from this crisis as the big winners as more consumers realise the benefits of shopping online without having to leave their homes. The increased popularity in online shopping will be welcomed within a suffering air cargo industry which could see a potential return to pre-COVID profitability a lot sooner than expected.

The Importance of Freight Forwarders in the Current Climate

It’s hard to predict what a post-COVID world will look like for the airline industry. With part nationalised airlines receiving government bail outs, business and commercial travel looking set to decrease and a fluctuating oil price, it can start to look like a minefield for all involved. Senior management will need to act fast to implement the appropriate social distancing measures and key strategies to stay afloat; however, all is not lost. If predictions pay off and countries continue to hold higher inventories and near source their products, this could cause inflation and interest rates to rise. If this were to happen, holding expensive goods for a longer time may not be as cost-effective as previously considered, which could see more businesses favouring air freight over the alternative methods.

For business owners that rely on the transportation of goods, now is the time to instruct the services of a reputable freight forwarder, particularly one that keeps themselves abreast of developments and can navigate all these new changes to the industry to ensure the most cost-effective method of sending and receiving vital shipments for your company.

Time to Take Action

Make no mistake, the measures that have been introduced as a result of COVID-19 are here to stay and industries, such as logistics, will work very differently. This is undoubtedly one of the greatest, if not the greatest challenge that the modern world has ever faced. The time to take action is now and those who are willing to adapt will prosper.

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Top Five Tips for First Time Exporting

Thousands of businesses are avoiding international expansion despite the enticing overseas markets that exist for their products. Take the first step to global success, by following our top tips for first time exporting for small businesses.

The Success of the Small Business on an International Level

An increasing number of start-ups and small businesses are including international sales as part of their business strategy. With the surge in popularity, more and more first-time exporters are entering the markets. Around 10 percent of all UK SMEs are exporters and are currently capitalising on a share of the £287,000 in additional revenue that these orders can deliver. In fact, according to UK Export Finance, firms that traded internationally in the last 2 years have grown at a rate of 15% compared to just 8.4% for those focusing solely on domestic markets.

For those businesses looking to take the plunge, get ahead of your competitors today and read on for our top five tips for first time exporting.

1. Identify Profitable Markets

If your company is yet to receive their first international order, conducting market research is imperative. If done effectively, your research will set you up with a foundation in market demand, growth opportunities and an understanding of your competition which could save you millions in the long run. If companies do not invest the time in market research, important cultural, competitor and pricing factors can be missed and the opportunity for profit can be seriously impacted.

2. Market Regulations

Regulations relating to safety, production and quality control differ within markets, particularly in the pharmaceutical and food production industries. The slightest variation could require large, expensive changes in production. Understanding the regulations from the outset will give businesses a good idea of their target audience without making costly mistakes in the process. This level of detail extends to companies who deal with consumer’s personal data. The introduction of privacy laws in Europe and US states like California hold companies to strict guidelines with hefty fines for non-compliance.

3. The Logistics

Facilitating orders on an international scale is vastly different to operating at a domestic level. Whilst globalisation has made this significantly easier in recent years, small firms are still required to go through certain changes when operating internationally for the first time. Fluctuating shipping costs, delays and lost cargo all need to be taken into consideration. It was only a few months ago that COVID-19 single handedly brought markets to its knees with some not expected to bounce back for years.

Once logistics such as potential warehousing is arranged, there’s the small matter of customs paperwork to complete which, as the Brexit process has shown, can be complex and costly, particularly when dealing with large shipments. With this in mind, it is vital that companies instruct the assistance of reputable shipping comp

4. Navigating the Shift in Currency Value

Managing a vast number of currencies whilst selling internationally can be an issue for first time and novice exporters; however, all is not lost! Unlike multi-national organisations who hire currency traders, small businesses can follow simple steps to stay on top of the shift in currency values and protect price and profit margins.

Trading in your local currency, can prevent big headaches for companies and transfers the risk of shifting currency values over to the buyer. If this is not possible and the buyer insists on their own currency, it may be wise to lock in exchange rates in advance. It is highly unlikely that as a small firm, you are going to have the cash reserves to account for negative movements in foreign exchange but this option can mitigate daily fluctuations in currency values.

For a beginner, it is important not to try and play the market. Focusing on your product, your customers, adhering to international regulations and securing those first international orders are going to put you in a much better position.

5. Understanding Tariffs

Another issue that has been highlighted by the Brexit negotiations is the potential for new tariffs and regulations to be imposed on goods after the new trade deal is agreed. The introduction of these could seriously impact the importation of certain goods in favour of supporting local business as well as decreasing your profit margins and limiting long term sales volumes. Researching where free trade agreements exist can create a competitive edge to your business. If you really want to get ahead, sourcing where new free trade agreements are likely to be introduced and investing in those locations will ensure that you are one of the first to break into new markets when they arise. This requires a certain amount of discretion on the company’s part as potential trade disputes such as the one we are currently seeing between the United States and China can create serious losses if overlooked.

Is your Company Ready to Export?

One of the primary reasons that small businesses do not venture into international markets is down to a lack of resources and expertise. According to the Department of International Trade, companies with a turnover under £500,000 were unlikely to look into exporting globally despite 73% believing that there was a strong demand for British products and services. A quarter of these businesses added that they wouldn’t know who to turn to when looking for advice. As daunting a task as it may be for businesses, the insight and the advice is out there, whether it be sourced through an external agency or researched by the company themselves, now is as good a time as ever to break through into the global markets.