With many warewashing brands in the UK market importing their appliances from head offices based on the continent, the end of the Brexit transition period on 1 January 2021 may prove disruptive to their supply, especially if there is no deal between the UK and the EU.
So how are major warewasher manufacturers preparing for this new trading situation, and can they ensure continuity of supply?
At Meiko UK, MD Paul Anderson revealed: “We always hold stock, but a rather large additional back-up has been ordered in advance of any pending levies applied.”
“As yet there are no definitive tariffs confirmed. If we have a no deal, then the proposed levies have been submitted for consideration on goods entering the UK from the EU. We would not absorb these costs and they would be additional, but we would be transparent on all proposals and not apply any on costs on top.”
Anderson detailed that the proposed levies are 1.7% on machines and spares, 4% on chemicals, 2.7% on tables and fabrication and 6.5% on the plastic tank (CC).
When asked about logistics planning, Anderson responded: “Our transport from Germany to the UK is a key factor. We have already agreed rates in advance and pre-planned the extra time required at ports.”
And on the subject of the company’s spares and components supply chain, he added: “All Meiko engineers carry a comprehensive set of spares on their vans and we also have a considerable stockholding at Meiko HQ in Slough, available for next day delivery.
“Just recently, following a detailed assessment of stock being used nationwide on all calls, van stock items have been increased by 20% across 51 service vehicles nationwide, to increase first time fix.
“Meiko’s strength is in its consistency and we have great routes for spares already and I do not foresee any challenges here.”
At importer, Pentland Wholesale, technical director Andrew Threlfall has been working closely with all its suppliers and shipping agents with regards to the possible effects of Brexit and constantly monitoring government guidance updates in this area. “Pentland Wholesale is prepared for the upcoming challenges ahead,” he said.
“As negotiations are still taking place the exact details of tariff charges are currently unknown. We are anticipating extra costs relating to duty and additional transportation/carriage costs that will be incurred for the additional processes that will be required when importing/exporting from the EU. The biggest challenge is trading with Northern Ireland, as we believe any duty will have to be paid as products enter Northern Ireland, and claimed back after proving that the items are for use in Northern Ireland. It is inevitable that some of the costs will be passed on to the customer and there is a risk that duty could be paid twice, once coming into the UK and again when it goes to Northern Ireland.”
Pentland Wholesale carries an extensive stock of Blizzard and Kromo glass- and dishwashers in its UK warehouse. According to Threlfall: “In order to support our customers, we have increased stock levels slightly in preparation for Brexit and possible shipping delays. With the current Covid-19 pandemic, it has never been more important that glass and dishwashers perform properly. All our Blizzard and Kromo glass and dishwashers are equipped with built in chemical pumps and a thermo-stop function which ensures that every wash cycle is completed after performing a rinse, with rinse water that has been heated to a temperature above 85°C.”
Regarding impacts on the importation process, he noted: “We anticipate that logistics will be affected by the new EU trading terms; we are engaging with our customers, suppliers and delivery agents to ensure we are all aware of the new processes. We are reviewing all our database to ensure all the correct tariff codes are applied and reviewing our internal processes to ensure that any information required to submit declarations can be submitted in a timely manner.”
While on the firm’s parts supply, Threlfall added: “We do not feel that our spares and components supply chain will be severely impacted as business will continue even after Brexit. Pentland Wholesale carries an extensive range of spare parts in order to support all the equipment we sell.
“Other than the additional costs of duty being applied to spare parts, we can foresee delivery costs outside the UK may increase when exporting spare parts. Pentland Wholesale has reviewed our spare parts stock inventory and increased stock levels on key fast moving spare parts in preparation for Brexit in order to keep any possible price rises to a minimum.”
For Sweden-headquartered Wexiödisk, UK and Ireland country manager David Glover analysed: “Until a definitive deal or no-deal arrangement is made, it is difficult to predict how manufacturers will be affected, both from a logistical and financial perspective.
“Having said this, if additional tariffs and taxes do accumulate, we anticipate that the majority of manufacturers will be passing these costs onto their customers.
“Even with a slight price increase however, our forecasts show that Wexiödisk warewashers will remain competitively priced in comparison to other manufacturer models, thus dealers can still offer their customers good-value Swedish brilliance, no matter the outcome of Brexit.”
Drilling down into the topic of logistics, he commented: “If a no-deal Brexit goes ahead, logistical processes will without a doubt have to change. In order to prepare for this possibility, Wexiödisk has begun to investigate potential new routes to the UK market such as processing deliveries via a UK hub, rather than direct from our manufacturing facility in Sweden.
“On the flip-side, if a deal is reached, we will continue to process orders and deliveries direct for our manufacturing facility in Sweden.”
But Glover believes that there will be no issues when it comes to accessing spares: “Even before the potential of a no-deal Brexit reared its head, Wexiödisk UK had prioritised stock holding of spare parts, having partnered with the First Choice Group.
“As Wexiödisk UK’s official UK spare parts partner, the First Choice Group is responsible for managing a massive supply of Wexiödisk spare parts and components – parts which can be delivered to the dealer in a little as 24 hours.
“Having said this, we will of course review stock levels with the First Choice Group if a no-deal Brexit occurs and adapt accordingly.”
Another First Choice partner is Italian manufacturer, Krupps. Export MD Riccardo Scuotto underlined: “Our strong partnership with First Choice Group enables regular imports of our spares and components to the UK market. Large distributors usually order the parts in bulk from Italy. I do not foresee any problems during the Brexit transition period and even afterwards.”
However, he did concede: “We are not 100% sure about what the real extra tariffs will be at present. The main difference will be increased export costs that in reality are an outlay calculated from the transport cost when we import products to our UK stock.”
Scuotto detailed that Krupps’ current UK stock will operate as normal, adding: “The incoming 2021 products will be processed with the new trading terms and conditions. Our dealers and distributors can continue to order the products from our UK stock or direct from our Italian headquarters for products not available in the UK stockholding and which require delivery to any UK address.”
Plus on the importation process itself, he concluded: “Obviously, we have to implement our logistics with more documentation and information in order to comply with all the new requirements. We may need to improve our stock capacity in order to reduce the number of import consignments during the year and by doing so reduce the lead time for receiving the products in UK.