One of the first pieces of research into how North East businesses have fared since leaving the EU has shown 75% of respondents had difficulties in trading post Brexit, reporting it had a negative or very negative impact on their companies.
Organised by North East England Chamber of Commerce the survey looked at a wide range of issues from what was difficult in the new arrangements, any advantages of Brexit, cost implications and logistics.
Jack Simpson, Chamber training and global network adviser said: “Our survey analysed how businesses were finding EU trading six months on from Brexit. The results demonstrated clearly how challenging companies have found international trade, with a plethora of issues depending on their sector and products. We have identified the very urgent need for more, clear information from Government to support businesses and help find answers to their trading questions. There is no doubt Brexit is hitting our competitiveness as a country and will also make levelling up even harder, due to the North East’s long-standing, positive international trade record.”
Other headline figures from the survey highlighted that 37.5% of respondents said their EU sales had reduced since the start of the year, 45% said it has stayed the same with just 17% reporting an improvement.
One of the major changes of Brexit is that businesses, which have only traded in the single market, now have to go through customs processes. The results showed over half of respondents had experienced difficulties in these procedures.
As well as the increased paperwork the tariff and administrative customs costs have also caused problems with 41% of businesses struggling to absorb the new financial burden. Only 5% said they were able to absorb new costs.
The logistics of trading with the EU has also proved challenging according to the results. A total of 66.7% of respondents confirmed they had been impacted by port congestion, delays or a shortage of hauliers since January. In addition to this there were reports of price inflation for containers and shipping, impacting cashflow and lead times for manufacturing supply chains.
Another issue raised by the Chamber survey respondents was the short timescale (seven days) they had to fully understand the EU deal before it was implemented.
Jack Simpson said: “We believe these results show larger businesses with more international trade resources, who have dealt with countries outside the EU, have coped with Brexit more easily than others who had no previous knowledge or experience. Respondents also experienced difficulties due to matters outside their control, for example, confusion over the required paperwork and shortage of experts, such as vets, to approve movements
“Under the new UK-EU relationship, most goods’ movements rely on multiple stakeholders working together, such as buyers, sellers, freight forwarders, customs agents, hauliers and others, towards the same end. Unfortunately, this chain of stakeholders can only be as strong as its weakest component, and an error made by one can have profound impacts for the others.”
The survey was conducted from 26 April 2021 and ran until 24 May 2021.
The Chamber has an international trade support desk which has specialists who help companies with EU and global trading and delivers expert training on customs and other procedures.