Supply chain issues and Brexit planning statement

The UK left the EU as of the 31st January 2020. The transition period ended on December 31st 2020. Whilst the UK and EU negotiate the final relationship; the latest indicators are that they are still far away from a frictionless free trade agreement.

The October 15th deadline imposed by the Prime Minister after the EU summit has now passed and there has been little progress with both the EU and UK unable to compromise on fisheries, governance of borders and level playing field rules and regulations.

Without a further extension of the transition period into 2021 No Deal or Hard Brexit consequences are still possible causing, World Trade organisation tariffs and duties on exports and imports resulting in price increases and delays, on goods and services caused by interruptions of normal supply chains and regulatory disruption..

To assist our customers Brexit mitigation process we are happy to receive or provide (if needed) individual customers annual usage data to assess their requirements during this period.

Whilst we cannot predict the exact reaction of the laboratory market to a ‘No deal Brexit’, we wish to re-assure customers that we are doing what we can to ensure we provide continuity of supply and are happy to enter into a constructive dialogue prior to Brexit with both our customers and Suppliers.

BREXIT MITIGATION STATEMENT
Updated October 19th  2020

As of the 15th October 2020, Camlab have assessed the risk of this No Deal scenario to have increased this would have an initial adverse supply chain impact that will affect both our customers and suppliers.

Stocks

We have reviewed our stocks and identified a number of critical ‘A&B line’ consumable products including forward ordered PPE like gloves, with extended delivery periods and worldwide material shortages due to the impact of the Coronavirus world-wide  pandemic. We have regularly communicated with our Suppliers and have recommended that they hold additional buffer stocks to cover such an eventuality or utilise space at the Camlab warehouse to increase product availability.

Employees

We also continue to communicate regularly with our staff regarding any residency issues for them and their families. We will be providing financial or other assistance with citizenship applications and visas to ensure continuity of employment and customer service.

Supply chain, Customs declarations

We have put in place Brexit mitigation plans for a ‘No Deal scenario’ to try to minimise the supply chain disruption and negative impact for our customers on critical products pre and post the Brexit deadline. We have reviewed the customs compliance and we have registered for the HMRC ‘Transitional Simplified Procedures’ to reduce the amount of information needed for an import declaration when goods are cross the border from the EU.

We no longer see a requirement at this time to obtain accreditation as an Authorised Economic Operator (AEO). We are already a long term experienced international importer and exporter of goods to and from the UK, however we will provide additional resources and training for more of our staff to help facilitate this process.

We are anticipating additional delays at the customs border, combined with extended delivery periods on imported goods due to the enhanced regulations and potential lack of availability of transportation from a number of ports. We are expecting potential significant market volatility over the coming months, which could adversely affect the current UK economic and supply chain environment. We have a strong relationship with our experienced freight forwarder and will be providing additional training to staff on the new border procedures. We are already experiencing increased costs of shipping due to COVID-19 shortages. Duty and tariffs will also increase costs of delivered goods to the UK, inevitably leading to more price increases in 2021.

Critical items

Where possible we are identifying alternative manufacturer’s products for our current fast moving critical products and on request will provide samples to customers to pre-approve these alternative items as backup, critical for their work, prior to Brexit. If however any customers who are not currently purchasing these critical items from Camlab and wish to consider Camlab as a secondary or dual-source for these goods we would  be happy to also discuss their requirements for inclusion in our stock planning process or to be listed on their system as an alternative source.

Currency

We have assessed that there is also likely to be an adverse impact on both currency and costs of imports which on COVID related products have already seen significant price increases and are encouraging our customer base to pre-order critical items so this can be included in our planning. This will reduce the cost impact for those customers who can commit to a pre-order.

 

Price increases

Further price increases from suppliers or from poor Sterling/Euro exchange rates are expected and we will work with our suppliers to try to provide an adequate notice period for all customers. To do this effectively we will work closely with both our suppliers and customers to forward plan and achieve the correct stock holding in a potentially difficult uncertain volatile trading environment. We will endeavour to buy in economic quantities to help mitigate excessive single unit price increases.

Panic buying and controls

We are aware that we may find abnormal quantities are purchased prior to Brexit due to ‘panic buying’ causing a run on certain items and a ‘stock out’ situation on critical products such as Personal Protective Equipment (PPE), Laboratory consumables, reagents and kits. We have set up process to manage our stock numbers and limit large abnormal quantity purchases have reserved stock accordingly for our existing customers and those who have engaged in forward planning with Camlab; Even so quantity restrictions may apply at times and customers should anticipate some disruption and endeavour to ration their own usage on critical products or find alternatives.

Camlab contact details for more information regarding Brexit mitigation planning.

 

Ben Sunderland

Managing Director

 

You can view our Brexit Readiness Questionnaire and our Risk Assessment or request a call back by clicking on the buttons below