TIME has effectively run out for businesses who have not prepared for the worst impact of a no-deal Brexit.
This is according to Mike McGrath of ARVO Procurement Consultants who added that with a strong possibility of Britain leaving the European Union without a deal on December 31, many Irish companies will be left exposed by the weakest links in their supply chain.
ARVO Procurement says Irish companies are facing the implementation of one of the most unique trading borders in the world, whereby there will be two trading principles across the Irish sea.
Mike McGrath said: “I remain fascinated by the fact that so many Irish businesses have yet to deep dive into the challenges that a No Deal Brexit will post. The creation of a ‘parallel universe’ for Northern Ireland has created a bureaucratic nightmare, whereby NI businesses have one foot in each market (UK and EU) but this will require much red tape to control bad actors, e.g. there now will be a CE Mark for European products, a UKCA mark for UK products and the UKNI Mark for NI products, so companies trading on both sides of the border will need a crash course on international product certifications and standards.
“A similar risk exists with regards the supply of Chemicals, where over 8,000 products are currently registered by UK Companies with regards to REACH (the key chemical control regulation in the European Union) but these will all expire on December 31, even though many are destined for the Irish market.
“Therefore, UK suppliers will have to re-register and change operation into the EU, or the Irish customer/distributor will have to register as an importer, if these products are going to be available in Ireland in 2021.
“Once again, the weakest link in the supply-chain will be tested as both these measures require significant resources, while the UK will introduce their UK REACH authorisation next year to add more confusion to the matter.”
The challenges posed by Brexit will come on top of a difficult year for SMEs, who have been dealing with the impact on Covid-19 on their businesses.
From Arvo’s perspective, there are many potential supply-chain risks as above with many twists and turns expected to continue in the years ahead within this complex EU-UK trading relationship.
Mike McGrath, in advising SMEs, said: “Arvo would urge all businesses to deeply engage with all key suppliers, particularly those with a direct or indirect dependency on a UK counterpart. In addition, visit www.arvo.ie to download a free eBook outlining many supplier risk management tactics to sustain your business in the event of Brexit.”