The UK’s transition out of the EU ends on 31 December: is your business ready?
Time is running out to make sure your company is geared up for the challenge of new regulations, contracts and processes coming into effect in the new year. Find out how other British firms are rising to the challenge…
New year, new era: on 1 January 2021, the UK begins a new chapter in its history. As the clock strikes 12, the transition period from the single market and customs union will officially end following the country’s departure from the European Union (EU).
It heralds a host of opportunities and also challenges, which UK businesses need to prepare for. A range of rules will come into effect and before that date, measures need to be taken by British companies that trade with EU countries, to ensure they adapt as smoothly as possible.
If your business hasn’t begun preparing for the end of the transition period on 31 December, there’s no time to lose. But where do you begin?
Details on the processes, contracts and agreements that need to be established before 2021 can be found on the Government website. There you can find useful information on a variety of subjects, from how to declare goods as of 1 January 2021, to what importers’ tax and duty rates will be under the new system. And there are numerous other sources of help to guide you through the changes.
Many businesses have already completed their preparations with the help of multiple resources, or simply by planning ahead for any eventuality. Here’s a selection of their stories.
James Ellis, owner director, Ellis Wines
Ellis Wines are a family-run wine importer and distributor with a wine heritage dating back to 1822, focusing on supplying wines to UK restaurants, pubs, hotels and bars.
Owner director James Ellis drives their philosophy to offer a distinctive and unique range of wines and also providing valuable advice to their hospitality clients.
Ellis says, “We import over 1000 wines from over 200 like-minded family-owned wine producers with the majority based in Europe, many being friends with whom we have worked for many years.”
Ellis Wines imported nearly three million bottles from Europe in 2019, representing 70% of their total imports. They are using information provided by the UK Government and advising suppliers about what they will need to do in order to comply with exporting to the UK from 1 January 2021.
Suppliers will need to produce extra documentation to take wine through UK and European customs so Ellis Wines are working with them to ensure they are ready for this after 31 December 2020. Ellis says, “We are also stocking up a bit more ahead of the UK Transition to help control costs in the first few months.”
Ellis Wines are also working with a number of official agencies including the Wine & Spirit Trade Association, who have been very helpful and represent many UK wine importers.
Ellis will continue to import wines from Europe and also look at opportunities further afield. He explains, “We will also look at importing new world wines from South Africa, Chile, Argentina and other countries to diversify our portfolio.”
Looking to the future, this family-run business want to continue with what they have been doing for the last 200 years. Ellis says, “We generally source wines that are exclusive to us. This allows our customers to create a wine list which is exciting and unique, with wines you won’t find in supermarkets. This is a resilient industry, which will adapt to anything.”
Justin Crump, chief executive, Sibylline
In the army you are taught to assess risks, says Justin Crump, military veteran and chief executive of strategic risk consultancy Sibylline. He has considered the future beyond the end of the transition period in December and is confident it’s all under control.
“We are very lucky in the services sector – and 80 per cent of the UK economy is service-based. I don’t anticipate any real business interruption. Europe isn’t any hassle, even with the changes. It’s not keeping me up at night.”
He founded Sibylline 10 years ago and advises clients on various threats from money laundering through to armed conflict. Business demand for risk assessment has doubled in size over the last three years, and this year is looking just as healthy – and the company is recruiting. His core clients include global businesses and range from oil and gas through to technology, hospitality, even NGOs. Some 20 per cent of business takes place in the EU – “a big proportion of our profits”.
He does anticipate minor changes in VAT, billing entities and the movement of people within the EU. “Our services may have to evolve a little if we need to put people on the ground. We may have to work with local partners or start a local company,” he says. His company hires from around the world, so he’s already familiar with visa procedures: “This just brings Europe in line with what we do already in countries such as Brazil, India, the US or Singapore.”
While exporters and manufacturers face changes next year, “we are not seeing panic among our manufacturing clients. The key really is making sure businesses stay abreast of the situation.”
A weaker pound since 2016 has helped make exporters more competitive. And while the turbulence of the pandemic has impacted some smaller firms’ preparations for UK transition, it has made many businesses more resilient and able to improvise. “I think businesses who can prepare have largely done so. Those who are hoping it will all go away might get a big surprise.”
Lyall Cresswell, CEO, Transport Exchange Group
“Whatever the deal is, there’s still going to be a process, depending on what you’re shipping, in a way that wasn’t there [before],” says transport expert Lyall Cresswell on how the end of the UK transition period will affect imports and exports.
“The main thing is that businesses really need to sit up,” he adds.
Cresswell founded the Transport Exchange Group (TEG) 20 years ago – a trading platform, which runs two of the UK’s largest independent freight exchanges, the Haulage Exchange and Courier Exchange.
Working with both domestic transportation firms and those that operate throughout the European Union, Cresswell says that there will be changes that will affect both, either directly or indirectly.
How this will affect each business, however, comes down in part to the “preparedness of their customers”; in other words, the organisations importing and exporting goods.
As for Cresswell’s firm, he is dedicated to ensuring it remains ahead of the curve, wherever possible. “One of the things that we have done is we’ve translated our platform into a number of different languages,” he reveals.
As well as ensuring his business remains compliant with all regulations – “our role is to make sure that we have the documentary evidence to support [our users’] membership on the platform” – Cresswell is determined to stay at the “forefront” of digitalisation.
Not only is it TEG’s raison d’etre, but efficient digital workflows will ultimately help tackle any administrative challenges that arise following the transition period end on 31 December 2020.
Helping to prepare for what lies ahead, Cresswell cites his partnership with Logistics UK (formerly the Freight Transport Association) as a useful resource, as well as the Road Haulage Association website, which he says has “very good information on what's required”.
As to advice he’d offer those in the exporting and importing trade, his answer is simple: “If you haven’t done so already, get yourself set up with a customs broker as soon as possible.”
To find out more about how to prepare your business for leaving the EU, visit gov.uk/transition
This article is part of a paid-for Partnership with the UK Government