Realising post-Brexit efficiencies with streamlined customs clearances

After the Brexit transition period finally ended on 31st December 2020 and with Covid-19 protocols causing disruption to travel, it is clear that the logistics industry has seen a challenging start to 2021, writes Pol Sweeney, VP Sales and Country Manager UK, Descartes.

Despite fair warning for businesses, there have been numerous reports of severely delayed journeys caused by increased customs documentation and ‘Brexit red tape’, exacerbated by the need for hauliers to provide negative Covid tests to travel. The required volumes of declarations has also led to significant wastage of fresh produce, damaging businesses and impacting whole sectors.

Indeed, some 3PL organisations actually halted deliveries in January to the EU or Northern Ireland due to the increase of documentation, showing the true impact of Brexit on supply chains. This not only disrupts logistics operations, but is fundamentally damaging to the UK economy. The government was reportedly encouraging UK companies to set up in Europe to avoid trade disruption, which would inflict companies with yet more costs and take capital away from the country. And with fears of a double-dip recession due to Brexit on top of the already fragile economy due to repeated lockdowns, it is clear that the economy is suffering.

Many have been prepared, but for those that haven’t and that may be in the midst of Brexit-induced disruption, how can a smooth declaration process be achieved in order to reduce issues at the border and prevent further economic loss?

Creating suitable borders 

For organisations importing a large number of items the entire customs process can be significantly accelerated by implementing an ETSF (External Temporary Storage Facility) located at your own business’ site, away from the port. Goods arriving into the UK can be moved to your site (e.g. a business’ premises or distribution centre), where the customs formalities can be managed electronically. In other words, the customs border is effectively moved to your own premises, so customs declarations can be pre-lodged ahead of the goods arriving, enabling the site to operate as if it is the Customs Frontier from a HMRC and Border Force perspective, so long as it is running an approved ETSF solution. Additionally, an inventory system designed to group goods at truck-level could further strengthen the ETSF set up, meaning once a truck physically arrives at your site, the system will trigger the clearance of all it’s consignments so they can be appropriately managed.

An ETSF system gives visibility and audit records to HMRC and Border Force so that if they do want to put a hold on any consignment, the site operator knows instantly which goods are on hold awaiting paperwork or physical inspection – this can also be conducted at the operator’s site. Thereby ensuring smooth declaration processes and reducing the impact of delays and hold-ups at the port.

Certainties for Customs Clearances 

As we have seen, ports such as Dover have faced severe disruption following the end of the Brexit transition period, delaying goods for more than half of UK companies trading with the EU. For trucks needing to transport goods, any clearances that can be moved inland will notably benefit supply chains, especially those looking to quickly clear and distribute or sell products on. This is especially relevant for organisations operating with JIT arrival of parts on trucks. Delays at the border will have a significant impact on their ability to do this, leading to loss of produce and resulting in extra costs.

Certain product categories still require clearance checks at the border for safety reasons, such as meat and dairy products. However, performing as many clearance checks as possible inland both speeds up the process for those vehicles that can go straight to the ETSF and also unlocks efficiencies for those that will still have to complete clearances at the border, benefiting companies that transport different items across multiple categories.

Businesses that import or export from the EU have to be fully aware of customs clearances requirements to protect their operations from economic loss. Import customers declarations from the EU will be required from July 2021. Safety and Security filings (S&S) for goods moving from the UK to the EU  have been a major cause of disruption for haulage and freight companies, as customers are required to submit the shipping instructions up to 2 hours before arrival. This has caused significant disruption and extra costs to the wider supply chain, affecting both businesses and consumers. From 1st January 2022, safety and security filings will also be required from road carriers bringing goods into the UK from the EU.

In addition, traders, hauliers and carriers moving goods through a UK port using the Goods Vehicle Movement Service (GVMS) are now required to register with the HMRC for the service in order to transport goods through customs. The extra red tape and permissions needed can cause unnecessary delays and disruption if organisations are not successfully registered for the GVMS. Companies should consider having a solution that incorporates the paperwork required to easily move goods, in order to optimise the process. By ensuring certainty of their own clearances, businesses can avoid hold-ups and unlock efficiencies where possible to reduce the risk of further economic damage.

The lesson from the end of the Brexit transition period is that companies need to act now and not wait until deadlines if they want to operate without disruptions.

Minimising Disruption

Now the transition period has ended, businesses need to capitalise on smart solutions to mitigate any more disruption due to Brexit, and with Covid protocols impeding the movement of goods, the time to act is now.

With Brexit causing much uncertainty, a streamlined import or export process that effectively manages customs clearances can help to support the already struggling UK economy. A double-dip recession is a serious concern and the economy is performing poorly. Covid will continue to be a challenge for the remainder of 2021 but companies have the opportunity to prepare against further Brexit disruption and introduce some certainty and security into their cross-border operations.

For more information see www.descartes.com/brexit

 

 

BIFA hopes for “made-to-measure” Covid testing for incoming hauliers

Freight forwarders are hoping that the introduction of a ‘bespoke Covid testing regime’ for hauliers arriving in England from outside the UK from April 6th, doesn’t throw another spoke into the wheels of cross channel trade, says Robert Keen, director general of the British International Freight Association (BIFA).

“Our members, which manage a significant proportion of the visible trade between the UK and the EU, have seen major disruptions to their operations for many months as a result of Covid; the changes to how import and export trade is conducted following the UK’s departure from the EU; as well macroeconomic issues affecting all modes of international freight transport.”

Earlier in March, when the UK government extended the deadlines of the Border Operating Model, BIFA said it was not surprised and welcomed the news that government will engage extensively with businesses.

Keen adds: “Controlling the spread of new Covid variants is critical and we want the new bespoke Covid testing regime for hauliers to work, but not impede trade flows. We invite government and its relevant agencies to work closely with us and our members and learn from the mistakes of the past when some political decisions were made that appeared to pay little regard to how visible international trade and the frontier actually works in practice.

“BIFA members are pinning their hopes that the bespoke Covid testing regime lives up to its billing and is made-to-measure, not off-the-peg. Creating more uncertainty will be of no use to anyone involved in managing the UK’s visible international trade.”

10000 Units Transported on Dunkerque-Rosslare Line

The Danish company DFDS Seaways has just announced the introduction of a fourth ship from 1 April on the ferry line between Dunkerque and Rosslare. The announcement confirms the success of the link, launched with three vessels on 2 January.

On 1 April next, the “Ark Dania”, a RoRo type vessel with a capacity of 188 freight units, will complete the fleet on the Dunkerque-Rosslare route, alongside the “Visby”, “Kerry” and “Drotten”.
The route provides exporters and transport companies with a direct, document-free journey for lorries between the Republic of Ireland and the other countries of the European Union, implying lower costs, less waiting time as well as the possibility of avoiding the customs procedures which now apply to transport via the British ‘landbridge’.

Aidan Coffey, Route Director for DFDS Seaways Ireland, is delighted with the addition of this fourth vessel to the fleet: “This ferry will be the flagship for our route. She is highly manoeuvrable, and is capable of transporting a wide range of cargo, mainly consisting of unaccompanied trailers and 12 trucks accompanied by drivers. The addition to our service will free up capacity on our three other vessels for more trucks accompanied by a driver. We are facing strong demand from all sectors of industry seeking to use the direct route to northern central Europe”.

Daniel Deschodt, Interim Chairman of the Executive Board, said: “European carriers and shippers are responding very favourably to this new post-Brexit offering tailored to meet their expectations. Indeed, since the first port call in Dunkerque on 2 January, the service totalled no less than 10,000 units at the beginning of March. With eight weekly round trips to and from Ireland, in the space of only four months the Port of Dunkerque has become the European mainland port with the highest number of round trips for ro-ro services to Ireland. The new traffic is also generating increased business and genuine added value for logistics warehouses located in the vicinity of the port. With this fourth ship, Dunkerque is more than ever the port for the British Isles!”

More Paperwork is Worsening Delays at the UK/EU Border, find CIPS Survey

The delays at the UK/EU border is getting worse, research by the Chartered Institute of Procurement & Supply (CIPS) has found. Over half (58%) of UK businesses say that delays have become longer since the beginning of January 2021 with 30% of this group reporting that delays are significantly longer than they were when the new border rules first came into effect at the beginning of the year.

The survey of 350 UK supply chain managers* found that 63% have experienced delays at the UK/EU border of at least 2-3 days getting goods into the UK, up from 38% in a similar survey in January this year. The situation is only slightly better for exports, with 44% experiencing delays of at least 2-3 days getting goods into the EU.

By far the main driver of delays is the time it takes for customs to work through the new paperwork, with nearly half of businesses (47%) citing this as the main reason for the delays. Other customs issues such as a lack of capacity amongst customs staff and drivers being turned away for having the wrong paperwork were also cited by respondents.

The delays come despite the fact many new import certifications are still yet to come into force. The extra checks, which will impact a wide range of goods from sausages to live mussels, are due to be phased in from April.

Dr John Glen, CIPS Economist and Visiting Fellow at the Cranfield School of Management, said: “We are well into the second month of the new arrangements and the hope that delays at the border would reduce as freight volumes returned to normal and customs systems became used to the new processes has not come to pass. What is even more concerning is that the delays are continuing to get longer, putting more and more pressure on the UK’s supply chains and affecting the timely delivery of much-needed goods.

“The paperwork required at the border is not going to change anytime soon, so we should brace ourselves for these delays to continue for at least the next few months. New requirements for import certifications are also rapidly approaching and these will only add to the paperwork required, causing further delays for businesses. The knock-on impact of these delays will trickle far down the supply chain and ultimately result in stock shortages and inflated prices for consumers”.

About the survey

These findings were drawn from a survey of 350 UK supply chain managers who have imported or exported through the UK-EU border since 1st January 2021. The survey ran from Friday 12th February to Thursday 18th February 2021.

*All respondents are UK supply chain managers who have imported or exported through the UK/EU border since 1st January.

Posted in UncategorisedTagged

More Paperwork is Worsening Delays at the UK/EU Border, find CIPS Survey

The delays at the UK/EU border is getting worse, research by the Chartered Institute of Procurement & Supply (CIPS) has found. Over half (58%) of UK businesses say that delays have become longer since the beginning of January 2021 with 30% of this group reporting that delays are significantly longer than they were when the new border rules first came into effect at the beginning of the year.

The survey of 350 UK supply chain managers* found that 63% have experienced delays at the UK/EU border of at least 2-3 days getting goods into the UK, up from 38% in a similar survey in January this year. The situation is only slightly better for exports, with 44% experiencing delays of at least 2-3 days getting goods into the EU.

By far the main driver of delays is the time it takes for customs to work through the new paperwork, with nearly half of businesses (47%) citing this as the main reason for the delays. Other customs issues such as a lack of capacity amongst customs staff and drivers being turned away for having the wrong paperwork were also cited by respondents.

The delays come despite the fact many new import certifications are still yet to come into force. The extra checks, which will impact a wide range of goods from sausages to live mussels, are due to be phased in from April.

Dr John Glen, CIPS Economist and Visiting Fellow at the Cranfield School of Management, said: “We are well into the second month of the new arrangements and the hope that delays at the border would reduce as freight volumes returned to normal and customs systems became used to the new processes has not come to pass. What is even more concerning is that the delays are continuing to get longer, putting more and more pressure on the UK’s supply chains and affecting the timely delivery of much-needed goods.

“The paperwork required at the border is not going to change anytime soon, so we should brace ourselves for these delays to continue for at least the next few months. New requirements for import certifications are also rapidly approaching and these will only add to the paperwork required, causing further delays for businesses. The knock-on impact of these delays will trickle far down the supply chain and ultimately result in stock shortages and inflated prices for consumers”.

About the survey

These findings were drawn from a survey of 350 UK supply chain managers who have imported or exported through the UK-EU border since 1st January 2021. The survey ran from Friday 12th February to Thursday 18th February 2021.

*All respondents are UK supply chain managers who have imported or exported through the UK/EU border since 1st January.

New Year, New Customs Provider?

3PL specialists Gefco explain why it could be vital to review your customs partners for 2021. 2020 was a year like no other for many manufacturers and their supply chains. It posed challenges that will continue to test even the most resilient of manufacturing businesses as we steadily move towards a global recovery. Of course, all this also comes at a time when we’re witnessing some of the biggest shifts in international trade for over two decades.

Making the transition from free and open trade between the EU and UK to the current regulations has been especially difficult in this climate and indeed, many have struggled to cope or adequately prepare in time. Now that we’re into the New Year and beyond the initial adjustment period it is vital that your business is working with an overland logistics partner that is going to deliver for your business.

At Gefco, we’re helping numerous businesses navigate this tricky period. With 17 Authorised Economic Operator certifications to our name, customs operations in 118 countries and over 50 years of experience in the trade and customs sector, our specialists facilitate the customs services that manufacturers need to ensure operations run smoothly.

Even during simpler times, efficient and cost-effective logistics planning can be a challenge. The new wave of rules and regulations which have come into force now that the UK-EU border is reinstated will aggravate that challenge, creating original and complex demands on UK manufacturers, who will often need to re-engineer their processes and reallocate their already overstretched
time, teams and budgets.

The process of ensuring products are customs-compliant can often be complicated by fragmented information, confused communications and poor visibility. When it comes to ensuring better control of crossborder operations, Gefco focuses on three pillars, which it calls the three Cs: Consolidation, Connectivity and Collaboration. The ideal 2021 logistics partner will help you achieve these through a full audit of processes and flows, and through the use of technology to connect remote operations, enable your teams to store and access all important documentation in one place, and give you complete visibility of your cross-border operations.

In manufacturing businesses, adaptability is crucial; whether it’s responding to changing circumstances or customer demands, the ability to adapt has a direct impact on profitability and business success. To ensure this, manufacturers need experts who are approachable, responsive and well-equipped. The ideal customer partner will have every post-Brexit eventuality covered. In Gefco’s case, we can lean on an integrated network of national and international hubs, and services that cover the full range of over-land freight options, including full load (FTL), less than load (LTL) and groupage.

Similarly vital to the success of manufacturers in 2021 will be the steady and reliable flow of raw materials into the UK. Assessing how Brexit might have affected the flow of the materials businesses need to manufacture their goods is a business imperative. Amongst the options to consider, are the utilisation of new Smart Borders in France – an IT solution based on anticipated customs formalities which can help deliver compliance, as well as time and cost efficiencies. Gefco’s experts can help manufacturers navigate this new frontier to help ensure manufacturers are maintaining that all-important steady flow of raw materials.

It’s difficult to overstate the value of having an expert logistics partner to lean on during challenging times. And with trade negotiations having gone right down to the wire and creating so much uncertainty and confusion, it’s more important than ever that manufacturers have a dependable and capable supply chain partner: one that will help facilitate getting goods to where they need to be, safely and securely, regardless of the new levels of complexity that Brexit has brought.

Brexit’s Impact on the Logistics Sector Says C H Robinson Director: “Tighter customs, more administration and additional duties,”:

The UK and EU reached a last-minute trade deal before the start of Brexit however, the UK’s withdrawal from Europe has brought uncertainty, confusion and widespread change amongst supply chains.

While a robust trade deal is vital to keep the flow of goods moving between the EU and UK, equally important is logisticians knowing precisely what’s required of them to ensure their shipments comply with new and extensive border rules.

Chris Mills, director of account management, transportation at C.H. Robinson Europe (pictured above), the multi-modal transportation platform provider, said: “Not all UK businesses were as prepared for Brexit as they could have been, but this was understandable given the uncertainty created by the trade deal negotiations going down to the wire.

“Even though Brexit is now ‘done’, and a trade deal has been agreed, it has become evident that leaving the EU has placed an increased burden on supply chains thanks to the raft of new complex process now in place. Indeed, some major retailers have temporarily suspended shipments between Great Britain and Northern Ireland due to ‘Brexit red tape’[1].

“The impact on the logistics industry looks set to remain during 2021 and beyond. Tighter customs, more administration and additional duties have become a reality and it’s vital everyone involved in shipping understands the changes – and keeps on top of any future developments – to ensure the efficient movement goods.

 Mills points to the most direct consequences on logistics following the UK’s departure from Europe, including:

  • There are no applicable import duties and quotas on general cargo between the EU and UK
  • Import and export declarations need to be issued for crossing the EU-UK border
  • Zero duties are for EU/UK origin goods only, so shipping to the EU/UK from a third country will not change and import duties will be charged
  • When shipping to the EU from a third country and the import is done in the EU, moving the shipment onwards to the UK must be customs cleared. The UK will also charge import duties, because of origin third country
  • Non-EU companies registered in the EU for import/export activities who need to have the same options in the UK must apply for a UK EORInr/VATnr

Mills concludes: “The new border between the EU and UK needs time to settle and the logistics world is quickly getting up to speed with what’s required of them. For example, there have been well-documented delays at ports, many as a result of incomplete or incorrect paperwork and entire consignments can be held up if only one item doesn’t have the correct customs forms. This is just one thing that piles on additional pressure on supply chains as parcels need to be returned to customers so the required data can be provided.

“Of course, not everything is going to be plain sailing from the outset and it’s going to take time to get used to the new norm. However, logisticians should take advantage of the raft of help and advice readily available the ensure the smoothest transition possible.”

[1] https://www.bbc.co.uk/news/business-55583244

Brexit’s Impact on the Logistics Sector Says C H Robinson Director: “Tighter customs, more administration and additional duties,”:

The UK and EU reached a last-minute trade deal before the start of Brexit however, the UK’s withdrawal from Europe has brought uncertainty, confusion and widespread change amongst supply chains.

While a robust trade deal is vital to keep the flow of goods moving between the EU and UK, equally important is logisticians knowing precisely what’s required of them to ensure their shipments comply with new and extensive border rules.

Chris Mills, director of account management, transportation at C.H. Robinson Europe (pictured above), the multi-modal transportation platform provider, said: “Not all UK businesses were as prepared for Brexit as they could have been, but this was understandable given the uncertainty created by the trade deal negotiations going down to the wire.

“Even though Brexit is now ‘done’, and a trade deal has been agreed, it has become evident that leaving the EU has placed an increased burden on supply chains thanks to the raft of new complex process now in place. Indeed, some major retailers have temporarily suspended shipments between Great Britain and Northern Ireland due to ‘Brexit red tape’[1].

“The impact on the logistics industry looks set to remain during 2021 and beyond. Tighter customs, more administration and additional duties have become a reality and it’s vital everyone involved in shipping understands the changes – and keeps on top of any future developments – to ensure the efficient movement goods.

 Mills points to the most direct consequences on logistics following the UK’s departure from Europe, including:

  • There are no applicable import duties and quotas on general cargo between the EU and UK
  • Import and export declarations need to be issued for crossing the EU-UK border
  • Zero duties are for EU/UK origin goods only, so shipping to the EU/UK from a third country will not change and import duties will be charged
  • When shipping to the EU from a third country and the import is done in the EU, moving the shipment onwards to the UK must be customs cleared. The UK will also charge import duties, because of origin third country
  • Non-EU companies registered in the EU for import/export activities who need to have the same options in the UK must apply for a UK EORInr/VATnr

Mills concludes: “The new border between the EU and UK needs time to settle and the logistics world is quickly getting up to speed with what’s required of them. For example, there have been well-documented delays at ports, many as a result of incomplete or incorrect paperwork and entire consignments can be held up if only one item doesn’t have the correct customs forms. This is just one thing that piles on additional pressure on supply chains as parcels need to be returned to customers so the required data can be provided.

“Of course, not everything is going to be plain sailing from the outset and it’s going to take time to get used to the new norm. However, logisticians should take advantage of the raft of help and advice readily available the ensure the smoothest transition possible.”

[1] https://www.bbc.co.uk/news/business-55583244

Posted in UncategorisedTagged

Road Transport Capacity in Europe falls while Prices Rise

The result of the most recent evaluation of the Transport Market Monitor (TMM), an online service provided by Tim Consult, is based on road transportation data of more than 1.8 million freight loads per year. The processed data, stemming from the spot market, is provided by Transporeon, Europe’s leading network provider for transport logistics services. The report is based on data available up to January 7, 2021.

• Compared to the previous month, road transport capacity fell significantly by -16.4% in December 2020. The European spot market availability index now stands at 85.9 points.
• Currently, there is significantly less road transport capacity available on the market than a year before. The capacity index fell by -16% compared to December 2019.
• Transport prices increased by +3.9% between November and December 2020. Compared to December 2019, prices went down by -2,7%.
Brexit impact
• Significantly falling capacity and rising prices can especially be observed on the corridor between France and the UK, which is impacted by Brexit. Road transport capacity from France to the UK reached a two-year-low at 58.8 index points. This corresponds to a huge decrease of -39.4% compared to the previous month. Prices went up strongly (+34.8%) during the same period, peaking at 154.3 index points, a two-year-high. Compared to December 2019, transport capacity fell by -22.1% while prices soared +51%.
• Transport capacity and prices for goods shipped from Germany to the UK showed a similar development. Transport capacity decreased by -29.7% between November and December 2020, reaching a two-year-low of 85.3 index points. At the same time, prices rose sharply by +41.2%, reaching a two-year-high of 153.9 index points.
Industry focus
• In the European automotive sector, road transport capacity went down by
-17.9% in December 2020 compared to November 2020, falling to a two-year low of 72.3 index points. Prices have continued to follow their positive trend since May 2020 peaking at a two-year high of 105.6 index points for the automotive branch. This corresponds to an increasement of +1.8% in December 2020 compared to the month before.
• In the chemicals and life sciences sector, the road transport capacity index fell strongly by -14.6% to 96.2 points in December 2020 compared to the previous month. Prices have jumped by +13.5% during the same period in the industry.
• Transport capacities in the steel sector went down significantly by -22.5% between November and December 2020. At the same time, prices reached a two-year high of 111.2 points. Since May 2020, a stable trend of steadily rising transport prices can be observed in the steel sector. From November to December 2020 alone, prices have sharply risen by +8.7%.

Meadow Foods deploys e-Customs Solution to prepare for Brexit

Meadow Foods, a leading supplier of dairy ingredients and inclusions to the food industry, is preparing for Brexit through use of a new e-Customs solution by Descartes Systems Group.

In order to continue ‘business as usual’ post-Brexit, Descartes’ e-Customs solution will support Meadow Foods to manage an estimated ten-fold increase in export declarations to Europe.

Gary Marshall, IT director, Meadow Foods, comments: “While there has been much uncertainty around Brexit and the implications that it will have on businesses, one thing we do know is that the number of mandatory customs declarations will increase.

“As an organisation that regularly exports to Europe and Ireland, preparing ahead of time for an anticipated ten-fold increase in export customs entries was essential to ensure that we prevent any unnecessary supply chain hold-ups and thereby maintain our excellent customer relationships and reputation. With such an increase to the expected volume of export entries, it became clear that it wouldn’t be efficient to continue with our previous manual process, nor did we want to lose control over the process by outsourcing to a third party.

“Another huge benefit to deploying Descartes’ e-Customs solution is the ability to interface with our ExportMaster ShipShape system, offering us a way of streamlining the process in-house, saving both costs and time.”

We know that Brexit is likely to bring supply chain disruption throughout 2021 – Pol Sweeney, VP Sales and Business Manager, Descartes

Pol Sweeney, VP Sales and Business Manager UK for Descartes adds: “We know that Brexit is likely to bring supply chain disruption throughout 2021, but installing Descartes’ e-Customs solution will help to minimise business inefficiencies that are within Meadow Foods’ control, such as the complicated import and export customs declarations process. A large proportion of Meadow Foods’ business involves exporting into Ireland, and our e-Customs solution will enable Meadow Foods to efficiently navigate the customs road that lays ahead.”

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