Brexit complexity piles up, leading to calls for more coordination
To cope with the Brexit fall-out, companies will need to adopt more transparency as they shift to new ways of working, according to the Open Data Institute
Under post-Brexit changes, individual UK businesses wanting to sell to the EU will have to ship to a European warehouse. They will need to ship stock to a European warehouse at their own cost, increasing transport and storage costs. Therefore, they will need to estimate how much stock they are selling in the UK compared to the EU and reconfigure processes accordingly.
Amazon has announced it is severing EU distribution ties for UK sellers using UK fulfilment centres, meaning these businesses will no longer be offered logistics and warehousing services.
This sort of process shift demands an increased flow of information across all parties in order to make sure stocks are in the right place.
Brexit has already seen companies in sectors like food and pharmaceuticals stockpiling to manage inventories, but stockpiling will not be an answer for the provision of perishable goods from the EU.
Instead, companies will have to ensure they have storage space to keep stock in good condition and to share data with suppliers and businesses about how much space is available. Information on customs charges and logistics to allocate costs efficiently will also be necessary.
Localising supply chains to reduce the costs of inventory carrying, or alternatively building parallel supply chains, has necessitated the use of advanced technologies to cope with the cost of UK-based manufacturing labour.
Companies need to optimise data sharing to offset the higher prices, increased distribution costs, raw material shortages and delays created by new custom checks and trade arrangements. Data sharing will help companies monitor blockages caused new customs registration processes involving EORI numbers, to keep track of supplies and avoid or limit delays.
The Institute’s case studies indicate that data sharing will benefit supply chain optimisation, increase efficiency and reduce costs.
Airbus improved the design process of its products using real-time data on all aspects of its supply chain. This also helped collaborative working practices with its stakeholders. BMW’s creation of PartChain has resulted in increased component traceability and supply chain efficiency.
Data sharing will help companies' resilience, ensuring they stay agile and competitive. To this end, the Open Data Institute has created a toolkit to help businesses identify opportunities in data sharing.