Supermarket prices will rise more than is necessary unless there is greater collaboration with European suppliers on post-Brexit trade frictions, a Dutch business has warned.
Moolenaar, a supplier of flower bulbs and seeds to many of the major supermarkets including Tesco, Sainsbury’s and Marks & Spencer, said some retailers were refusing to help with the new logistical difficulties even though they often had in-house teams doing the same job.
While the UK has delayed full import checks until 2022, EU exporters must still navigate a range of new processes such as VAT and customs paperwork. Moolenaar has requested help adapting to the changes, but CEO Ian Rasmussen said “there’s a number of the retailers saying ‘no, we don’t want to hear about it. You’re the exporter, it’s your problem.’”
While he emphasised most supermarkets had offered support, he warned price differences could soon emerge between those who collaborated with their suppliers and those that didn’t. “If you work with your suppliers in finding solutions then you can save quite big costs in the supply chain,” he added.
Moolenaar’s plant products are often on the UK’s ’high-priority’ plants list and so must undergo certain physical inspections at the point of destination. While some supermarkets have allowed this to take place at their distribution centres, “there have been some retailers who just say: ‘no, don’t want to know about it. Don’t want to inspect it,’” said Rasmussen. As a result, the goods must be taken to another location in the UK meaning additional transport costs and delays.
Moolenaar similarly has “quite a lot of money” tied up in VAT administration as it is having to set up and handle the process. This had resulted in reduced cashflow and additional costs, which could be eased if retailers with pre-established VAT processes in-house offered to take greater responsibility, said Rasmussen.
“There’s a huge variety in how the retailers prepare and there’s a huge difference in how they collaborate with their suppliers as well,” he said. “But they should ask how they can actually put their fingers in the beehive? Can they somehow make that supply chain more efficient? Because you can for sure once you start working together.”