INTERNATIONAL TRADE
Steering through the exporting obstacles
The end of the UK-EU transition period has created a number of challenges for exporters, ranging from delayed deliveries to new codes being required on parcels. Two months into the new era, Dan Robinson gets a temperature check of how businesses in the region are faring.
Forest Waterway this summer, shaving off every millisecond without touching a post within the 25 gates will be the name of the game.
W Aiding many of the Olympic
teams will be the Racer ST 2020 suit, the latest garment innovation to come out of Peak UK’s small Darley Dale factory. “No one else in the world makes
garments like this,” says owner Pete Astles, whose kayak and canoe equipment is used across the world by enthusiasts dreaming of becoming the next Michal Martikán or Joe Clarke – just two of the Olympic gold medallists the company sponsors. But in the first few weeks of this
year, just six months away from the Tokyo Games, the end of the UK- EU transition period brought much of its business to a standstill. Peak UK suspended deliveries to
Europe as congestion at the border meant too many of its parcels weren’t reaching their end destination, despite carrying all the correct documentation. “It’s unworkable so I’ve told my
team not to send anything to Europe until we have a solution,” says Pete. “When you add this to everything going on with the Covid crisis, many small businesses will give up.”
hen the Olympic canoe slalom paddlers race down the courses at Japan’s Sea
About half of Peak UK’s £2m
turnover comprises EU sales. End customers are typically small enthusiast shops so expertise in trade rules is thin on the ground. But as someone who has been
selling across the world for 31 years in business, Pete is well-accustomed to exporting rules and had expected Brexit to bring EU trade in line with how it ships to the rest of the world. It’s been anything but. For parcels that have arrived,
Pete describes “horror stories” from customers about the size of the bills they’ve received for duties, taxes and fees, with little evidence about how inconsistent calculations have been made. While much of this could be
attributed to teething problems, there’s longer-term concerns for Pete in how the EU trade deal’s tariff-free rules of origin only include goods made in the UK or EU. “Even though the IP and design
for our products is in the UK, the main origin of the supply chain is China because that’s where it’s far more cost-effective to make, so we have to pay duties to import and export,” says Pete.
SUCH WOES ARE by no means exclusive to Peak UK. Chesterfield- based label manufacturer MTM Products, which imports most of its materials from the EU and exports about a fifth of its products directly into the continent, has also experienced problems with clogged-up couriers. “Deliveries that should take a
day are taking about three days, and those that should be three or four days are taking up to a week,” says managing director Ian Greenaway, who also suspended deliveries during the second week of January. “It’s frustrating for customer relationships.” Ian believed his firm was
reasonably well prepared for 1 January, but there have been unforeseen problems such as around getting the wording for preferential
rates of duties correct. Accounting systems will need adjusting to produce the right dispatch documentation and invoices, but software providers have been inundated with similar requests. The priority is to get parcels out
and turning to express shipping – which has brought down some delivery times – has cost MTM roughly 5% of its EU turnover. Ian predicts it won’t be before
the end of the first quarter until “we get to a sensible situation” but, given that UK-EU trade is relatively low because lots of businesses stockpiled before Christmas in anticipation of bottlenecks, he wonders whether normal volumes can be handled effectively.
Peak UK founder Pete Astles is unhappy at the initial impact of Brexit on his business
British Olympic gold medallist Joe Clarke is sponsored by Peak UK
50 business network March 2021
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