What plans have you made for your business for Brexit?
Discussion
I'd rather this didn't turn into a Brexit slagging match and I'm not sure if this topic has been covered yet?
Clearly we have no idea whatsoever where we'll stand come April 1st 2019.....what plans have other business owners made for April 1st next year - either way..............?
Me - We are an exhibition build company, trading for 22 years and we work mainly in the UK however do build throughout Europe and to be honest I don't think there's a lot we can do. For example we are too small to open a new office and employ staff in either Germany or France and don't have any industry contacts in Europe that can help build simply because the core structure we have used and invested in for the last 10 years is a UK based product and we can't buy, mark up and then still win work - we'll price ourselves out of an already competitive marketplace.
We already have several jobs lined up in Germany, Holland, Spain and Sweden after April 1st next year and the best we can do is quote known costs and have a caveat that costs may increase to take into account any additional travelling or time spent at UK/European ports trying to get in or out. All of our clients have agreed that they may well end up spending more money which is a good thing albeit sometimes it's not unusual that we travel back from say Germany late Tuesday to go and build on another job in Manchester Wednesday or visa versa. Clearly if we are held up on either journey in or out that could have an effect on or ability to juggle balls.
From a pricing perspective we purchase from UK companies and I'm not expecting any significant price increases or delays so we should be good there.
I do know for example in the very unlikely event the worst should happen and flights suffer from the UK to Europe Easyjet to get around the situation they have opened a new Austrian office, are currently re-registering all of their UK pilots to have Austrian licenses and most if not all of their aircraft will be EU registered rather than UK registered - that's a good way to ensure day 1 they keep aircraft in the air and revenue coming through the front door. Clearly they are feeling uneasy about the situation.
Oh, and I'm not on a scare mongering exercise here, I'm simply interested in what like minded business owners are doing.....
And you lot?
Clearly we have no idea whatsoever where we'll stand come April 1st 2019.....what plans have other business owners made for April 1st next year - either way..............?
Me - We are an exhibition build company, trading for 22 years and we work mainly in the UK however do build throughout Europe and to be honest I don't think there's a lot we can do. For example we are too small to open a new office and employ staff in either Germany or France and don't have any industry contacts in Europe that can help build simply because the core structure we have used and invested in for the last 10 years is a UK based product and we can't buy, mark up and then still win work - we'll price ourselves out of an already competitive marketplace.
We already have several jobs lined up in Germany, Holland, Spain and Sweden after April 1st next year and the best we can do is quote known costs and have a caveat that costs may increase to take into account any additional travelling or time spent at UK/European ports trying to get in or out. All of our clients have agreed that they may well end up spending more money which is a good thing albeit sometimes it's not unusual that we travel back from say Germany late Tuesday to go and build on another job in Manchester Wednesday or visa versa. Clearly if we are held up on either journey in or out that could have an effect on or ability to juggle balls.
From a pricing perspective we purchase from UK companies and I'm not expecting any significant price increases or delays so we should be good there.
I do know for example in the very unlikely event the worst should happen and flights suffer from the UK to Europe Easyjet to get around the situation they have opened a new Austrian office, are currently re-registering all of their UK pilots to have Austrian licenses and most if not all of their aircraft will be EU registered rather than UK registered - that's a good way to ensure day 1 they keep aircraft in the air and revenue coming through the front door. Clearly they are feeling uneasy about the situation.
Oh, and I'm not on a scare mongering exercise here, I'm simply interested in what like minded business owners are doing.....
And you lot?
it may be worth assessing what carries the greater tariff % in your business
by that, I expect you have aluminium poles, plastic panels, signage, wooden panels, carpets etc. I don't know if wto tariffs for those 'components' are higher or lower than 'exhibition stands'
if lower - it may be worth exploring the ROI on importing at the component level and assembling on site in Europe ?
by that, I expect you have aluminium poles, plastic panels, signage, wooden panels, carpets etc. I don't know if wto tariffs for those 'components' are higher or lower than 'exhibition stands'
if lower - it may be worth exploring the ROI on importing at the component level and assembling on site in Europe ?
I suspect that whatever 'difficulties' may lie ahead will be down to the EU and how spiteful they feel. There don't have to be any tariffs if they don't want them.
You only realise how far we got sucked into the EU machine when we try to escape. And let's not forget that most of what we buy comes from China, which is not the EU.
While the liberals will scream that they can't get to mummy's villa in France and the sky will fall in, life will go on.
You only realise how far we got sucked into the EU machine when we try to escape. And let's not forget that most of what we buy comes from China, which is not the EU.
While the liberals will scream that they can't get to mummy's villa in France and the sky will fall in, life will go on.
HoHoHo said:
I'd rather this didn't turn into a Brexit slagging match and I'm not sure if this topic has been covered yet?
Clearly we have no idea whatsoever where we'll stand come April 1st 2019.....what plans have other business owners made for April 1st next year - either way..............?
Me - We are an exhibition build company...
If you are not selling the exhibition stuff to companies but just taking it to Europe, putting it up and then bringing it back again later to the UK, you might need a Carnet post Brexit, which would avoid duty payments if they are otherwise required. Talk to your local chamber of commerce - while the specific details won't be clear yet they'll give you a general overview of how it works; you would need to lodge security with them (a significant proportion of the value of the goods IIRC) but you get that money back again at the end.Clearly we have no idea whatsoever where we'll stand come April 1st 2019.....what plans have other business owners made for April 1st next year - either way..............?
Me - We are an exhibition build company...
I've done a little bit of talking for DIT on Brexit preparation for SME manufacturing companies, and what I suggested to everyone who turned up was that it makes sense to plan for the hardest Brexit possible - the majority of what you'll need for that is going to be required whatever type of Brexit we have and so there's no big loss from doing it.
These points are all completely standard in international trade so we can be confident that they'll all be required regardless of the final position.
The three main things I called out in those talks were:
1. Contracts. For any contracts after 29/03/19 is there anything you aren't going to be able to do? Are you using DDP or EXW Incoterms in EU supply contracts, because those won't work properly?
2. Tariff codes. Have you classified all of your products?
3. Origin. Will you be able to declare the origin of your products? (this is a much more complicated question than it might appear, as there are special rules that apply to most products, and "it was made in my factory" doesn't always cut it)
Regulation and certification will be a big issue but until we get an idea of the shape of those (which could range from nothing at all to having to get lots of colourful stamped documents from the government) there's not a lot that can be done.
For the contracts post d-day, can you produce before hand and store in Europe somewhere? Even if it’s a self storage location?
Assuming you don’t want to do that, why not have your stand builders fly in and out of Europe and just hire drivers to drive rental trucks (not loading, just driving) across the border. That way you won’t have the issue of your staff not being in the correct location.
Any chance of your UK suppliers (of printed media for example) already have contacts in Europe you could explore using?
Assuming you don’t want to do that, why not have your stand builders fly in and out of Europe and just hire drivers to drive rental trucks (not loading, just driving) across the border. That way you won’t have the issue of your staff not being in the correct location.
Any chance of your UK suppliers (of printed media for example) already have contacts in Europe you could explore using?
Thanks all for your replies, not quite what I had in mind....I am curious what lengths other businesses are having to go to due to the uncertainty of Brexit.
However to respond and my thoughts on replies so far:
As mentioned the majority of our work is in the UK so I don’t see any issues there.
We believe the base extrusion we use is manufactured in Turkey. We tried for some years to identify the source but we can’t and we share pretty good at finding supply sources. As it happens we now have so much stock it’s not quite so important, we now tend to buy more stock as and when only to replace damaged or worn out stock or perhaps for a totally bespoke design.
We are familiar with a Carnet and have commodity codes for all items shipped, we already ship smaller items worldwide almost on a daily basis (we don’t simply design and build, we offer a far greater service to clients and that’s part of out USP), so that’s covered and fully understood.
I suppose I as write here one of my concerns for all businesses working and travelling to and from mainland Europe is how will the current logistics and travel arrangements change because we simply don’t know! Of course not all UK businesses travel across the border, I’m guessing most won’t be effected directly albeit we don’t know how many will indirectly!
Take today as a typical example of a busy weekend; We have 3 stands to start builing at Olympia this morning, three stands to breakdown at Excel this evening from a dental show built earlier this week, and an event for three clients we are involved with in Vienna which involves staff driving there early today to be there tomorrow. Add to that two more stands being started at the NEC tomorrow and a further stand in Westminster to build Monday pm.
So this weekend the bulk are in the UK however other weekends we are not just juggling in the UK but in the UK and all over Europe. I’m no more worried than normal, we do what we do very well and we have the right staff and contractors in the right place. However if the border processes become lengthy and tiresome I can’t begin to imagine what effect that might have on logistics. I can’t afford to simply employ more people and train them just on case I need them, that just doesn’t stack up. Whilst I use contractors to help us our equipment is specialised and not all contractors are familiar with it so there’s no point paying someone who can’t do the job efficiently.....anyway, back on track....come Wednesday these all start to come down over a couple of days and we then get ready to go off to Holland and London again the following weekend/week....and so it goes on......phew!
We are very good having over 20 years experience of making mistakes at working smart. Of course we have additional vehicles and contract staff as and when in addition to our own but you have to be careful - as we’re all aware any additional costs can have an impact on GP and NP very quickly and it’s all a fine balancing act.
With regard to using contract drivers, for any number of reasons that’s simply not practical (albeit we have already done that on occasion). The practice of moving items around Europe would be difficult because many items we use on an exhibition-to-exhibition basis cross over from show to show in a just-in-time fashion and then there would be many months when we wouldn’t I use items and you’ll have a lot of stock sitting there doing nothing. Yes I can invest however I don’t want to invest any more than I am currently for a number of reasons.
To sum up I’m sure we are where we need to be and can be at this point in time. We are already familiar with shipping items all over the world, we do that very well and I can assure anyone who doesn’t it’s all lovely and rosey when it’s going well but you try working with DHL, TNT or whoever on a daily basis and you’ll soon wonder how the hell these businesses continue to operate!
Anyway, I’m off to work now, I’ve probably wobbled on and made may grammatical mistakes, my apologies, it’s early!
However to respond and my thoughts on replies so far:
As mentioned the majority of our work is in the UK so I don’t see any issues there.
We believe the base extrusion we use is manufactured in Turkey. We tried for some years to identify the source but we can’t and we share pretty good at finding supply sources. As it happens we now have so much stock it’s not quite so important, we now tend to buy more stock as and when only to replace damaged or worn out stock or perhaps for a totally bespoke design.
We are familiar with a Carnet and have commodity codes for all items shipped, we already ship smaller items worldwide almost on a daily basis (we don’t simply design and build, we offer a far greater service to clients and that’s part of out USP), so that’s covered and fully understood.
I suppose I as write here one of my concerns for all businesses working and travelling to and from mainland Europe is how will the current logistics and travel arrangements change because we simply don’t know! Of course not all UK businesses travel across the border, I’m guessing most won’t be effected directly albeit we don’t know how many will indirectly!
Take today as a typical example of a busy weekend; We have 3 stands to start builing at Olympia this morning, three stands to breakdown at Excel this evening from a dental show built earlier this week, and an event for three clients we are involved with in Vienna which involves staff driving there early today to be there tomorrow. Add to that two more stands being started at the NEC tomorrow and a further stand in Westminster to build Monday pm.
So this weekend the bulk are in the UK however other weekends we are not just juggling in the UK but in the UK and all over Europe. I’m no more worried than normal, we do what we do very well and we have the right staff and contractors in the right place. However if the border processes become lengthy and tiresome I can’t begin to imagine what effect that might have on logistics. I can’t afford to simply employ more people and train them just on case I need them, that just doesn’t stack up. Whilst I use contractors to help us our equipment is specialised and not all contractors are familiar with it so there’s no point paying someone who can’t do the job efficiently.....anyway, back on track....come Wednesday these all start to come down over a couple of days and we then get ready to go off to Holland and London again the following weekend/week....and so it goes on......phew!
We are very good having over 20 years experience of making mistakes at working smart. Of course we have additional vehicles and contract staff as and when in addition to our own but you have to be careful - as we’re all aware any additional costs can have an impact on GP and NP very quickly and it’s all a fine balancing act.
With regard to using contract drivers, for any number of reasons that’s simply not practical (albeit we have already done that on occasion). The practice of moving items around Europe would be difficult because many items we use on an exhibition-to-exhibition basis cross over from show to show in a just-in-time fashion and then there would be many months when we wouldn’t I use items and you’ll have a lot of stock sitting there doing nothing. Yes I can invest however I don’t want to invest any more than I am currently for a number of reasons.
To sum up I’m sure we are where we need to be and can be at this point in time. We are already familiar with shipping items all over the world, we do that very well and I can assure anyone who doesn’t it’s all lovely and rosey when it’s going well but you try working with DHL, TNT or whoever on a daily basis and you’ll soon wonder how the hell these businesses continue to operate!
Anyway, I’m off to work now, I’ve probably wobbled on and made may grammatical mistakes, my apologies, it’s early!
Sounds like you're well in your way in that case - getting all of the information in is the real donkey work required, so whatever we do end up with you should be OK.
One thing you might want to consider is the "Authorised Economic Operator" (AEO) scheme. It's not really been all that important up to now for UK businesses as it hasn't provided a lot of benefit, but either AEO or something like it will be the key to unlocking the expedited customs procedures you'll probably want - making customs declarations away from the border and sailing through an ANPR lane at Dover, that kind of thing.
AEO is a ball-ache but it's mainly documenting processes rather than doing things - if you've got everything tied down well already it might be that it's reasonably straightforward to obtain.
In terms of the physical movement of people by road, it shouldn't be too much of a problem. Your drivers will want international driver's permits:
https://www.gov.uk/government/publications/driving...
and I'd get those as early as possible to avoid the rush.
Flying won't be a problem either, despite all of the noise from politicians; perversely being able to use the "other" queue might result in getting through passport control a bit quicker at some airports, and there's always the duty free to consider.
One thing you might want to consider is the "Authorised Economic Operator" (AEO) scheme. It's not really been all that important up to now for UK businesses as it hasn't provided a lot of benefit, but either AEO or something like it will be the key to unlocking the expedited customs procedures you'll probably want - making customs declarations away from the border and sailing through an ANPR lane at Dover, that kind of thing.
AEO is a ball-ache but it's mainly documenting processes rather than doing things - if you've got everything tied down well already it might be that it's reasonably straightforward to obtain.
In terms of the physical movement of people by road, it shouldn't be too much of a problem. Your drivers will want international driver's permits:
https://www.gov.uk/government/publications/driving...
and I'd get those as early as possible to avoid the rush.
Flying won't be a problem either, despite all of the noise from politicians; perversely being able to use the "other" queue might result in getting through passport control a bit quicker at some airports, and there's always the duty free to consider.
It seems we are heading towards a Canada ++ deal. It is massively in the interest of the EU to have free-trade for goods, as they sell more to the UK, but at the same time disturb the dominance that the UK has in Services.
Drivers from Australia and the US drive in the EU without international permits so I do not believe that will become a serious issue - even in a hard Brexit scenario, as tourism is an essential part of the PIGS economies.
However, I am curious as to which side of the Goods - Services line that the OP’s business resides. Does the stand stay in the country of the exhibitor? Is erecting and breaking that stand not a service? My guess is that it is probably a Service. So, perhaps a Polish subcontract installation company could overcome any potential obstacle.
Drivers from Australia and the US drive in the EU without international permits so I do not believe that will become a serious issue - even in a hard Brexit scenario, as tourism is an essential part of the PIGS economies.
However, I am curious as to which side of the Goods - Services line that the OP’s business resides. Does the stand stay in the country of the exhibitor? Is erecting and breaking that stand not a service? My guess is that it is probably a Service. So, perhaps a Polish subcontract installation company could overcome any potential obstacle.
I work in the pharmaceutical industry for a small company. We manufacture in UK, ship to Europe (& other markets).
We (along with the rest of the pharma industry) have had to spend lots of money to get ready for a potential no deal Brexit scenario as the regulatory timelines we work under with Europe & the UK are long....so we are having to set-up a new business on the European mainland, develop the Quality Management System to support this, apply for the appropriate licences for that business, transfer licences from the UK into that business, find new testing labs and approve them and look for appropriate European citizens (QP's) who would be required to release batches into the European Union (that is currently done in the UK). All of this money is almost completely spent already.....and if the Govt manage to find a solution that allows a status quo for the transition period, it will be money either completely wasted as we'll never need those solutions....or money spent too early as not required until 2021. On the other hand, if No Deal transpires, patients will still be able to get their medicines in Europe.
We (along with the rest of the pharma industry) have had to spend lots of money to get ready for a potential no deal Brexit scenario as the regulatory timelines we work under with Europe & the UK are long....so we are having to set-up a new business on the European mainland, develop the Quality Management System to support this, apply for the appropriate licences for that business, transfer licences from the UK into that business, find new testing labs and approve them and look for appropriate European citizens (QP's) who would be required to release batches into the European Union (that is currently done in the UK). All of this money is almost completely spent already.....and if the Govt manage to find a solution that allows a status quo for the transition period, it will be money either completely wasted as we'll never need those solutions....or money spent too early as not required until 2021. On the other hand, if No Deal transpires, patients will still be able to get their medicines in Europe.
I was talking to a friend over the weekend and I had no idea that if there’s a no deal and we use the WTO for example then VAT on all goods and services on items purchase from the EU can’t be claimed back.....
So, up to 20% or more costs depending on what’s being purchased to either swallow or pass on.
Happy days
So, up to 20% or more costs depending on what’s being purchased to either swallow or pass on.
Happy days
HoHoHo said:
I was talking to a friend over the weekend and I had no idea that if there’s a no deal and we use the WTO for example then VAT on all goods and services on items purchase from the EU can’t be claimed back.....
So, up to 20% or more costs depending on what’s being purchased to either swallow or pass on.
Happy days
Errr...probably because that isn't right.So, up to 20% or more costs depending on what’s being purchased to either swallow or pass on.
Happy days
AFAIK, VAT would be charged in the UK (alongside duty) on imports from the EU and reclaimable as normal. It wouldn't be charged by the EU country, as it is being exported outside the EU VAT area.
loafer123 said:
HoHoHo said:
I was talking to a friend over the weekend and I had no idea that if there’s a no deal and we use the WTO for example then VAT on all goods and services on items purchase from the EU can’t be claimed back.....
So, up to 20% or more costs depending on what’s being purchased to either swallow or pass on.
Happy days
Errr...probably because that isn't right.So, up to 20% or more costs depending on what’s being purchased to either swallow or pass on.
Happy days
AFAIK, VAT would be charged in the UK (alongside duty) on imports from the EU and reclaimable as normal. It wouldn't be charged by the EU country, as it is being exported outside the EU VAT area.
VAT will be charged and we won’t be able to claim it back as we currently do.
davepoth said:
Are you using DDP or EXW Incoterms in EU supply contracts, because those won't work properly?
I'm interested, why won't DDP or EXW Incoterms work? I realise that DDP may have an unknown cost component, so may not be advisable, but surely EXW is what it says it is and leaves it to the buyer to transport, clear, etc.?Apologies if I'm missing anything obvious here.
We have already been forced into action.
Around 60% - 65% of our work is international. These are 'donor funded' development projects in weird and wonderful parts of the world. Of these, 80% are EU funded; not directly, usually via various development banks such as KfW, GiZ, EBRD, etc.. But the key is that the money is European.
The lead time on bids to mobilisation mean that from the beginning of this year, projects being tendered would not start until after March next year and as such, UK providers were warned that there would be no guarantee that they would be granted access to such opportunities post Brexit.
We generally work with a collaborative business, also domiciled in the UK, though working out of Bulgaria.
So, to counter the effects of Brexit, we have created a brand new company domiciled in Bulgaria. Actually, it's a commercial cooperative. Either way, we can continue to bid and hopefully win EU funded contracts. The outcome is no different, in fact we are better off as corporation tax in BG is less. It just means that we pay this tax to the BG government and not the UK.
Our UK work is dependent upon teams of temporary staff which have historically comprised large proportions of EU workers. Availability of these workers has declined drastically over the past 12 months. To attract British workers to the same roles requires allocating additional budget to levels that make the projects untenable. So we are withdrawing that service to clients.
Around 60% - 65% of our work is international. These are 'donor funded' development projects in weird and wonderful parts of the world. Of these, 80% are EU funded; not directly, usually via various development banks such as KfW, GiZ, EBRD, etc.. But the key is that the money is European.
The lead time on bids to mobilisation mean that from the beginning of this year, projects being tendered would not start until after March next year and as such, UK providers were warned that there would be no guarantee that they would be granted access to such opportunities post Brexit.
We generally work with a collaborative business, also domiciled in the UK, though working out of Bulgaria.
So, to counter the effects of Brexit, we have created a brand new company domiciled in Bulgaria. Actually, it's a commercial cooperative. Either way, we can continue to bid and hopefully win EU funded contracts. The outcome is no different, in fact we are better off as corporation tax in BG is less. It just means that we pay this tax to the BG government and not the UK.
Our UK work is dependent upon teams of temporary staff which have historically comprised large proportions of EU workers. Availability of these workers has declined drastically over the past 12 months. To attract British workers to the same roles requires allocating additional budget to levels that make the projects untenable. So we are withdrawing that service to clients.
HoHoHo said:
However we don’t import, we buy goods and services to be used in the EU at various shows and for example power, other utilities, rental furniture, rigging and other items which all add up.
VAT will be charged and we won’t be able to claim it back as we currently do.
Why can you not register for VAT in the countries in which you do business?VAT will be charged and we won’t be able to claim it back as we currently do.
loafer123 said:
HoHoHo said:
However we don’t import, we buy goods and services to be used in the EU at various shows and for example power, other utilities, rental furniture, rigging and other items which all add up.
VAT will be charged and we won’t be able to claim it back as we currently do.
Why can you not register for VAT in the countries in which you do business?VAT will be charged and we won’t be able to claim it back as we currently do.
As I mentioned the majority of our work is in the UK so we’re not talking thousands here however every % that we add on makes us slightly less competitive
HoHoHo said:
loafer123 said:
HoHoHo said:
However we don’t import, we buy goods and services to be used in the EU at various shows and for example power, other utilities, rental furniture, rigging and other items which all add up.
VAT will be charged and we won’t be able to claim it back as we currently do.
Why can you not register for VAT in the countries in which you do business?VAT will be charged and we won’t be able to claim it back as we currently do.
As I mentioned the majority of our work is in the UK so we’re not talking thousands here however every % that we add on makes us slightly less competitive
skwdenyer said:
davepoth said:
Are you using DDP or EXW Incoterms in EU supply contracts, because those won't work properly?
I'm interested, why won't DDP or EXW Incoterms work? I realise that DDP may have an unknown cost component, so may not be advisable, but surely EXW is what it says it is and leaves it to the buyer to transport, clear, etc.?Apologies if I'm missing anything obvious here.
Over the last few years we've had increasing numbers of customers and suppliers asking to move away from EXW, and my understanding is that EXW may be eliminated from the 2020 revision of Incoterms.
The correct term should really be FCA Seller's Premises, which puts the obligation for loading and export customs clearance onto the seller.
Going into the EU on DDP terms could cause problems too, as it may not be possible to obtain an EORI to clear the goods into the EU and reclaim the VAT yourself - meaning you'd have to do it using the buyer's EORI, and then work out some method with the buyer to account for the VAT and duty. That would be a massive headache.
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