Brexit related shortages/opportunities

Balanadan · 01-03-2019 7:50am #1

How's everyone's Brexit preparations going? Anyone else fed up of the uncertainty of the whole thing? I work for a progressive SME, we've done some amount of work on our supply chain, especially over the last 6-7 months. We can shift over 60% of our purchasing from the UK and the North to the EU overnight. We've been running down stocks to give us the flexibility this month.

Mod note: - this thread can be used to chart problems or opportunities for the Irish Economy arising from Brexit, including Northern Ireland. Anything relating to the economic impact on the UK as a whole or England/Scotland/Wales can still be dealt with in the main Brexit thread

badtoro · 01-03-2019 10:02am

Balanadan wrote: »

How's everyone's Brexit preparations going? Anyone else fed up of the uncertainty of the whole thing? I work for a progressive SME, we've done some amount of work on our supply chain, especially over the last 6-7 months. We can shift over 60% of our purchasing from the UK and the North to the EU overnight. We've been running down stocks to give us the flexibility this month.

Probably being more vigilant than normal in ensuring all lambs survive to sale. Hoping Welsh lamb is locked out of EU.

Deferred two big improvements on the farm until after dust settles.

prawnsambo · 01-03-2019 10:26am

Balanadan wrote: »

How's everyone's Brexit preparations going? Anyone else fed up of the uncertainty of the whole thing? I work for a progressive SME, we've done some amount of work on our supply chain, especially over the last 6-7 months. We can shift over 60% of our purchasing from the UK and the North to the EU overnight. We've been running down stocks to give us the flexibility this month.

I keep an eye on supermarkets, especially Tesco, who are highly dependant on imports from the UK. I've started to notice some brands disappearing off the shelves and being replaced by stuff that I have seen in Musgraves. Who apparently have almost completely taken the UK out of their supply chain. Also Dunnes now seem to be carrying products that are very similar to what's in the likes of Aldi and Lidl in their own brand range.

vickers209 · 01-03-2019 10:35am

prawnsambo wrote: »

I keep an eye on supermarkets, especially Tesco, who are highly dependant on imports from the UK. I've started to notice some brands disappearing off the shelves and being replaced by stuff that I have seen in Musgraves. Who apparently have almost completely taken the UK out of their supply chain. Also Dunnes now seem to be carrying products that are very similar to what's in the likes of Aldi and Lidl in their own brand range.

I noticed this also strange that Knorr sauces seem to have disappeared off shelves in Tesco and Centra.
I though Knorr was an Irish company

Peregrinus · 01-03-2019 10:40am

vickers209 wrote: »

I noticed this also strange that Knorr sauces seem to have disappeared off shelves in Tesco and Centra.
I though Knorr was an Irish company

German brand, owned by Unilever which is an Anglo-Dutch concern. May be distributed into Ireland from or via the UK, which could explain the shortaages you notice.

10000maniacs · 01-03-2019 11:37am

Peregrinus wrote: »

German brand, owned by Unilever which is an Anglo-Dutch concern. May be distributed into Ireland from or via the UK, which could explain the shortaages you notice.

That is true, I noticed that last weekend in the Merrion Centre. I hope its not a sign of things to come.

Sam Russell · 01-03-2019 11:39am

Peregrinus wrote: »

German brand, owned by Unilever which is an Anglo-Dutch concern. May be distributed into Ireland from or via the UK, which could explain the shortaages you notice.

Back in pre EU days and probably for most of the time since, Irish subsidiaries were operated as a sub-office of the Liverpool office. As the Irish economy improved (remember when we joined we were at 60% of the then EU average) these offices were gradually upgraded and only in recent decade have many of them been elevated to full country operations. In many cases, the rights to the Irish market were automatically added to the UK rights.

Now, because of the low language skills of both the UK and Ireland, it is much easier to deal with a UK supplier than to go the France or Germany or further afield, and consequently Irish buyers were paying a sizable premium because of the reluctance to go further in search of better prices.

Currently M&S prices in Ireland are significantly higher than UK prices for the same item. For example, an item (wool jumper) is GB£35 vs €47.50, which is 12.5% above the exchange rate (86p) and different VAT rate (1.23 vs 1.20). Also nearly 100% of stock sold in Ireland is imported from the UK,

We should have been looking further afield for many years.

iguana · 01-03-2019 11:55am

I have/had* 3 old dogs all on necessary medications which are experiencing shortages across the country that the vets and pharmacists are saying is Brexit related. The medications are made on the continent but coming through the UK and we think the shortage here is due to the British government stockpiling. It's taking a lot of planning to stay one step ahead and ensuring we have a constant supply of their medications. Back before November it was easy to get a quarterly supply of one of the medications every three months, but now we're lucky to get a months worth at a time. Sometimes we can only get a few days worth. We're hoping that once Brexit actually happens the supply will be rerouted and they'll go back to normal for us. I know the dogs are old and don't have a huge amount of time left but if they die before they have to because of Brexit that will be very hard to take.

It has made me quite wary about shortages. I have a few weeks worth of tinned fruit and veg, extra flour and oats, a months worth of coffee and a few months worth of a particular Twinnings tea I like and a few bottles of food supplements in a storage box. I'm going to order oil for my boiler next week and keep my car and my van topped up with petrol and diesel, respectively. I'm not convinced it's necessary but I'm a 'plan for the worst' type of person and if it's not needed the worst that will happen will be a few months of eating tinned peaches with my breakfast and baking some extra pineapple cakes.

*1 of the dogs died 2 weeks ago but not because of medication shortages.

prawnsambo · 01-03-2019 2:19pm

Sam Russell wrote: »

Back in pre EU days and probably for most of the time since, Irish subsidiaries were operated as a sub-office of the Liverpool office. As the Irish economy improved (remember when we joined we were at 60% of the then EU average) these offices were gradually upgraded and only in recent decade have many of them been elevated to full country operations. In many cases, the rights to the Irish market were automatically added to the UK rights.

Now, because of the low language skills of both the UK and Ireland, it is much easier to deal with a UK supplier than to go the France or Germany or further afield, and consequently Irish buyers were paying a sizable premium because of the reluctance to go further in search of better prices.

Currently M&S prices in Ireland are significantly higher than UK prices for the same item. For example, an item (wool jumper) is GB£35 vs €47.50, which is 12.5% above the exchange rate (86p) and different VAT rate (1.23 vs 1.20). Also nearly 100% of stock sold in Ireland is imported from the UK,

We should have been looking further afield for many years.

The M&S thing is a bit of an outlier - in that it's a purely UK brand and totally UK supplied. There's been such exchange ripoffs going on for donkeys years and it's replicated across many big name retailers like House of Fraser, H&M etc. Tesco seem to be reacting and sourcing more stuff here to avoid empty shelves.

The Ireland being handled by a UK distibutor thing is also a long standing issue. Easier to supply one distributor and let them handle the smaller market that is Ireland. I would suspect that a lot of these types of distribution deals will fall foul of brexit and be snapped up by Irish suppliers who will deal direct with Germany etc. It's probably haoppening already or else substitution is happening. I think I posted earlier in the brexit thread about sourcing a circulation pump for my heating and finding that it was considerably cheaper here than in the UK.

Sam Russell · 01-03-2019 2:44pm

prawnsambo wrote: »

The M&S thing is a bit of an outlier - in that it's a purely UK brand and totally UK supplied. There's been such exchange ripoffs going on for donkeys years and it's replicated across many big name retailers like House of Fraser, H&M etc. Tesco seem to be reacting and sourcing more stuff here to avoid empty shelves.

The Ireland being handled by a UK distibutor thing is also a long standing issue. Easier to supply one distributor and let them handle the smaller market that is Ireland. I would suspect that a lot of these types of distribution deals will fall foul of brexit and be snapped up by Irish suppliers who will deal direct with Germany etc. It's probably haoppening already or else substitution is happening. I think I posted earlier in the brexit thread about sourcing a circulation pump for my heating and finding that it was considerably cheaper here than in the UK.

It will be interesting to see what happens with cars.

Opel cars, when they were building cars in Luton, were assembled on the same line as Vauxhall cars to the same spec. Opel, Vauxhall, Renault and Nissan vans are all produced on the same line in Luton at the moment. I do not know how PSA will change things now that they own Opel. Astras are produced in Wales with the threat of closure, and Hondas in Swindon actually closing. That is what we know - for the moment. JLR are under threat.

Mercedes, VAG, etc supply RHD cars through the UK. That could well change.

Interesting times.

KyussB · 01-03-2019 5:45pm

Buying computers parts recently for up North, and noticing a ton of EU-wide businesses that will deliver to the South and the rest of the EU, but not the North/UK - seems that many businesses have already stopped trading with UK customers.

L1011 · 01-03-2019 11:32pm

I'm currently looking at moving from a few UK suppliers of specialist audio/comms equipment to Dutch ones - I have extremely basic reading Dutch and basically everyone I've dealt with has perfect English anyway. Shipments from .nl in the past have generally gone on Liege-Dublin freight flights so no UK landbridging involved

The EU ruling on geofencing/country restriction on sales landed at exactly the right time as frequently these firms used to refer me to the "Irish agent" who was usually the UK supplier. Prices are competitive. I wouldn't bother changing back to the UK suppliers even if they stay in. Suspect that's the case for most people who've been made change

reslfj · 02-03-2019 8:26pm

Sam Russell wrote: »

It will be interesting to see what happens with cars.
....
Vauxhall / Opel Astras are produced in Wales ...

Astras are build in Ellesmere Port in England (but just 5-8 km from Wales) and branded Vauxhall Astra for the UK market.

Astras are branded Opel Astra in continental Europe (EU26)

Lars

https://en.wikipedia.org/wiki/Vauxhall_Ellesmere_Port

MBSnr · 02-03-2019 11:29pm

Sam Russell wrote: »

We should have been looking further afield for many years.

Tell me about it...
I buy a lot of specialised computer stuff for my job, high end servers, GPU cards etc. All my Irish suppliers tend to get them via the UK and as such cannot compete on price. I mostly buy directly from Germany. A few yrs back I was after a card that was 3000 Euro in Germany, but by the time it was converted to GBP for the UK supplier, converted back to Euro for the Irish supplier and everyone taking their cut/markup, it was coming in at over 5000 Euro from Dublin... I was after 6 of them and saved 12 grand...

On the M&S thing - Debenhams are also another UK retailer with a savage Euro markup.

andrewfaulk · 07-03-2019 11:35pm

MBSnr wrote: »

Tell me about it...
I buy a lot of specialised computer stuff for my job, high end servers, GPU cards etc. All my Irish suppliers tend to get them via the UK and as such cannot compete on price. I mostly buy directly from Germany. A few yrs back I was after a card that was 3000 Euro in Germany, but by the time it was converted to GBP for the UK supplier, converted back to Euro for the Irish supplier and everyone taking their cut/markup, it was coming in at over 5000 Euro from Dublin... I was after 6 of them and saved 12 grand...

On the M&S thing - Debenhams are also another UK retailer with a savage Euro markup.

On losses from the Irish market alone, a lot of U.K. based parallel traders/wheeler dealers/ agents will really be losing out.. Particularly guys importing product into the U.K. to sell on with very tight margins..

I work in freight, and our U.K.-Ireland dept are seeing a lot of work for these companies to Irish supermarkets dying off already.. At the same time, Dublin port is getting busier with the same products coming in direct from Europe by container

janfebmar · 08-03-2019 12:11am

I wonder will prices in Lidl and Aldi come down? I was in Germany recently and prices of many things there was a lot less than Ireland.

prawnsambo · 08-03-2019 10:45am

janfebmar wrote: »

I wonder will prices in Lidl and Aldi come down? I was in Germany recently and prices of many things there was a lot less than Ireland.

I think the shipping cost is a major factor there. But I'm sure there's also local market pricing at play as well.

janfebmar · 08-03-2019 10:47am

prawnsambo wrote: »

I think the shipping cost is a major factor there. But I'm sure there's also local market pricing at play as well.

And higher insurance costs, electricity costs, labour costs etc in Ireland?

Peregrinus · 08-03-2019 10:54am

janfebmar wrote: »

And higher insurance costs, electricity costs, labour costs etc in Ireland?

And reduced economies of scale. And different premises costs. And all kinds of things.

otnomart · 11-03-2019 6:06pm

interesting findings in New Financial Report: Brexit & The City

the report "have identified 275 firms in the UK that have moved or are moving some of their business, staff, assets or legal entities from the UK to the EU to prepare for Brexit"

"Dublin is by far the biggest beneficiary with 100 relocations[/B], well ahead of Luxembourg (60), Paris (41), Frankfurt (40) and Amsterdam (32)."

https://newfinancial.org/the-impact-of-brexit-on-the-city/

pedroeibar1 · 13-03-2019 1:35am

So their report costs only GBP300. Cheap, but I won’t be buying it because I have an issue with how they interpret their information. There is a huge difference between nailing up a nameplate in Dublin and 'relocating' i.e. movement of jobs to Ireland.

According to their own website “New Financial is a think tank launched in 2014 that believes capital markets can and should be be /I][/B][I]sic[B a force for economic and social good.”
Well, let’s just look at insurance linked securities, a capital market product. After all it is their speciality and one which Ireland Inc. wants to grow. Eighteen deals have been done this year (since Jan.1) totaling more than €2.5 billion. Ireland was successful in getting just one deal, worth €45 million. Success? Really?
Another example, take the tales of the UK legal profession moving to Ireland -

“The number of transferring England and Wales solicitors leaped from some 50 in 2015 to 806 in 2016. The level of annual increase reduced slightly in 2017 to 547, but has surged again to date in 2018 with 601 applications this year (up to 15 November 2018), and 256 more applications currently being processed. (Ken Murphy, Law Soc.)

Does anyone believe that the leafy suburbs of SoCoDublin is now crammed with the residences of hundreds of solicitors from the UK? Or that dozens of UK law firms have opened offices here? Nope, they will remain in Surrey and nameplate here. (Less than a handful have, mainly for reasons unrelated to Brexit but it was the catalyst.)
A tiny back office for a bit of one of Berkshire Hathaway's small operations does not merit a headline of Buffet relocating to Ireland.

That report sounds like the PR waffle that the government spindoctors love, to distract from what is happening on the ground.

ednwireland · 13-03-2019 12:02pm

im bulk buying marmite and hp sauce just in case

think thats it

Quin_Dub · 13-03-2019 1:02pm

janfebmar wrote: »

I wonder will prices in Lidl and Aldi come down? I was in Germany recently and prices of many things there was a lot less than Ireland.

I doubt it , but there is a fairly good chance that prices in Tesco will go up comparatively.

So there will be some serious market share opportunity for those chains that do not rely heavily on UK Brands/Suppliers.

otnomart · 11-04-2019 6:38am

Some insighs on how a Company chose where to relocate:

"At the top of the list were availability of talented employees and proximity to London. A strong culture of technology entrepreneurship and cooperative regulators were important, too.

Excessive state bureaucracy, overly restrictive “Napoleonic” laws, and convoluted tax systems were major drawbacks for Spain and France, he said. Dublin was too small and too far away from the markets (they) wanted to penetrate.
The final choice came down to Germany or the Netherlands, and BaFin — the federal financial regulator — made Berlin “hard to break into,” Kent said.
So Amsterdam won out. “Our staff like it and it’s either 45 minutes by plane or a couple of hours by train ... and you can do everything in English,”

https://www.politico.eu/article/how-...tion-shopping/

Geuze · 11-04-2019 10:49pm

janfebmar wrote: »

And higher insurance costs, electricity costs, labour costs etc in Ireland?

Labour costs in Ireland are 32.10, below the 34.60 in Germany, data published today:

https://ec.europa.eu/eurostat/documents/2995521/9720156/3-11042019-BP-EN/3240675b-5513-41a4-8b28-3f5e24c55b70

Electricity prices to industrial users are higher here, yes.

The killer here is property costs.

Brexit related shortages/opportunities

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