- Extra cost and transit times
- Complex customs paperwork
- End of VAT deferred
- Many carriers and truckers pulling out of EU-UK
UK suppliers have been severely impacted by the implementation of new regulations from the 1st of January. Far from just teething problems in the new relationship between the UK and the EU, the issues facing UK exporters into the EU appear to be structural and could even deteriorate further as a stricter application of the import controls is applied.
Central to the delay incurred is the need to customs clear everything into the EU. VAT is payable. Rules of Origin have to be adhered to. Importers need to be EORI registered. An import customs clearance operation must be done (and charged for) to allow the goods to circulate freely in the EU. Perishable foods require costly certificates. Complicated rules covering what element of a product is EU origin have to be considered to reduce potential tariffs.
Superyacht Cargo has been shipping spares and parts to the yachting industry since 2003 and includes many of the world’s largest yachts in its portfolio, but is now reducing its UK presence to a representative office. Paul Bartholomew, director at Superyacht Cargo, says even during Covid lockdowns in 2020, the company was able to publish semi-decent returns. On an average month, the warehouse handles and consolidates 3000 packages- parts for engineering, deck, galley, AVIT, interiors, charter requests, crew purchases on a just-in-time basis. Paul Bartholomew says since 2021 they have shipped just 3. Clearly not sustainable.
‘One shipment had to be shipped in bond to Carrara costing the client ten times what he would have paid in December in free circulation. Another shipment of soda arrived so late the products had expired. A third has been with customs in Palma for over a month.’ says Eddie Lee, accounts manager.
To continue serving the UK superyacht industry in the EU, Superyacht Cargo has opened a distribution centre in Croatia for exporters who want to hold stock in the EU, and a transit short term warehouse in Nice, France.
Superyacht Cargo can advise exporters on bespoke product- to -yacht routes. Many yacht crew are unsure of the Brexit deal and are avoiding buying from the UK, preferring to buy in the EU where there are none of the distribution hassles. Those yachts who have UK sourced components embedded in the yacht’s infrastructure will need to allow extra time. Superyacht Cargo whose niche was consolidating inventory is now advising customers not to ship direct with couriers such as DHL or TNT, as the Next Day delivery schedule has become a phenomenon of the past. Often it is next week if you are lucky. Integrated solutions are the order of the day.
Superyacht Cargo also sources UK products for yachts in the Med, but has pulled away for the forthcoming season.
‘As much as I hate turning business away, we charge customers only when the goods have been delivered. And since we cannot guarantee delivery, timely or otherwise, we have often have to say no, Paul Bartholomew says.
The future for UK suppliers may lie in European distribution networks, rather than cross-border supply chains, with on demand stock and a next day pan European reach.