The number of supply chain managers looking to localise their respective supply chains because of Brexit has grown, according to the latest survey from the Chartered Institute of Procurement & Supply (CIPS).
Some 63% of EU businesses expect to move their supply chains out of the UK, while 40% of UK businesses are looking to replace their EU suppliers, the survey has suggested.
A similar survey from the institute in May showed that 45% of businesses from the continent who responded were looking to replace their UK suppliers while 31% of UK supply chain managers taking part said they were looking to replace their EU suppliers with local ones.
Hopes of a smooth transition into a trade agreement in March 2019 suffered a setback recently when the European Parliament decided that talks over the terms of the divorce had not progressed sufficiently for the next stage of negotiations, covering the two trade partners’ future relationship, to begin.
The CIPS survey of 1,118 supply chain managers was conducted between September 4 and October 5. A total of 106 EU-based businesses with British supply chains took part in the survey, including 702 UK businesses with EU suppliers and 106 EU businesses with UK supply chains.
CIPS said a fifth of British businesses were struggling to secure contracts that extend beyond March 2019, the date Britain is due to leave the EU; while nearly one in ten (8%) UK businesses said their organisations had already lost contracts as a result of Brexit – with 14% believing part or all of their organisation’s operations will no longer be viable.
Meanwhile, 25% of UK businesses with more than 250 employees have already spent more than $131,000 preparing their supply chain for the split. Only 14% of UK businesses with EU suppliers feel like they are sufficiently prepared for Brexit.
(picture courtesy of Jeff Djevdet speedpropertybuyers.co.uk/)