The UK’s transition out of the European Union has not been as smoothed as hoped, or at least not from a trade perspective. Whatever your politics, I doubt anyone wanted it to have the impact on cargo flows that we’re now seeing. According to the Office of National Statistics, exports of goods to the EU fell by 40% in January 2021, while imports dropped 29%. Whether retailers trying to get products into the UK or manufacturers trying to reach markets across the Channel, many sectors are struggling to get their goods into and out of the EU and the UK.
But why is this happening? An increase in paperwork certainly hasn’t helped. As the foreword to the MAKE UK Q1 2021 Manufacturing Outlook points out, “businesses are faced with a plethora of red tape and bureaucracy which will disproportionately impact the smaller companies that lack expertise than the larger firms that are more able to absorb these costs.”
The quotes highlight that it isn’t just the amount of bureaucracy involved, but the cost of it; from customs fees to expensive health certificates. British manufacturers that once sold as easily to Spain as they did to parts of the UK are facing significant obstacles that were not there last year. The increase in administration is such that a majority of UK IT decision-makers (68%) (eFax survey) believed extra levels of paperwork required to do business across EU borders, creates an additional security risk. Unsurprisingly, the same study found that 57% are accelerating the speed of digital transformation of paper-based processes as a direct result of the disruption caused by Brexit.
What’s more, 77% of respondents would have accelerated digital transformation sooner if they had been aware of how much the extra paperwork would slow down cross border trade and transport.
While some may argue that manufacturers can only react to the regulatory environment they operate in, there are still opportunities to improve their own operations. In doing so, they can increase their chances of enjoying frictionless cross-border travel and trade. One area to look at would be how they store and share documentation with employees and suppliers, irrespective of location.
We may all be living more digital lives, yet there are still many instances where physical documentation remains the norm. While many manufacturers have digitised processes, to get a product from factory to customer requires a significant number of third parties, all of whom have their own processes and preferred ways of working. For instance, bills of lading, the piece of paper that proves cargo ownership, are often couriered from one party to another. New digital versions, based on emerging technologies like blockchain, are increasingly available, but the majority of businesses are forced to overcome significant challenges to get paperwork into the right hands at the right time.
However, there is appetite for change. The eFax study found that 86% of respondents believe workers travelling across borders would benefit from the ability to send, receive, and securely sign extra layers of paperwork on-the-move.
A few years ago, this wouldn’t have been possible – neither the IT infrastructure nor the devices were available, at scale, for entire workforces to be equipped with the right tools to digitally share documentation appropriately. Now, however, high quality coverage, cloud computing, smartphones and tablets mean that a factory manager, production line worker, truck driver or other personnel can access paperwork, sign for it and share it securely, all from the palm of their hand.
The desire and the means are there – what manufacturers need to do now is ensure that their digital transformation, already being accelerated, covers all aspects of their operation. In doing so, they can ensure that they are well placed to optimise the transit of their cargo across borders, and get their products into the hands of customers.
There are always going to be disruptive external factors. Last year it was the pandemic, this year it has been the UK’s exit from the EU. No one wants to see backlogs of trucks snaking out of ports or customers left disappointed by deliveries unable to get over the border. For manufacturers, that means ensuring that everything they control is as slick and frictionless as possible. With more paperwork than ever before, making sure it is in the right hands, at the right time, is critical to this process.