Blog: Brexit punctured bike firm trade in EU FSB call for customs clearance – Punchline Gloucester

An urgent call to simplify customs clearance for businesses in Gloucestershire was made today by the Federation of Small Businesses (FSB).

And the call comes as a Gloucestershire bike specialist tells Punchline its export business has been deflated by a lack of post-Brexit trading agreement.

The FSB is urging ministers to open the Single Trade Window to simplify interaction – and warning that a failure to do so is sabotaging UK growth plans.

Tina McKenzie, FSB policy chair, said: “Small businesses are eager to grow their businesses overseas, but our findings show there are undeniable tariff and non-tariff barriers that prevent these firms from reaching their full potential and deter potential high-growth exporters.

“Our members consistently tell us the costs, time and administrative burden of trade are the reasons why they give up overseas markets. Complex customs procedures and high costs also put foreign consumers out of reach and create an uneven playing field for small firms.”

Today’s FSB’s Customs Clearance Report was the result of a survey of 807 small businesses on their experiences of international trade and their concerns and responses to global supply chain disruption between August and September 2022. 

It found nearly one in ten (9%) small firms who used to trade internationally have stopped doing so in the past five years, the volume of paperwork (56%), overall cost burden (49%) and supply chain and logistical issues (29%) being cited as key drivers.

Findings include that the majority of small firms face soaring costs and goods shortages due to global supply chain disruptions, while excessive customs paperwork is the top deterrent to international trade.

“Small firms who have continued to trade internationally have to battle against stiff headwinds, with six in ten (61%) identifying high shipping costs as the top challenge, followed by losses and delays in transit (56%) and lack of guidance on customs procedures (45%).

“More broadly, as a result of severe disruption to the global supply chain caused by the Russian invasion of Ukraine, an overwhelming majority (81%) of small firms have been affected by cost increases and shortages of goods that originate from outside the UK,” Ms McKenzie said.

“Unlike big corporates, most small firms don’t have specialised in-house resources to deal with customs paperwork. Only 9% say they have a dedicated employee or team. Seven in ten (71%) small traders use an intermediary for at least some of the process of handling customs declarations, while six in ten (61%) use a large fast parcel operator.”

Having just returned from an international bike show in Berlin, ‘fixie’ single-speed bike specialists Quella, who trade with a team of six from the Goodridge Trading Estate, say they are facing a “brick wall” for new and ongoing EU sales.

Mike Mellor, partner, said: “It’s heartbreaking. We have new product and, at the show, people never approached us asking about any details. All they say is ‘nice bike, but I can’t get it, can I?’. Question them on their problem and they’ll tell you such issues as DHL refused to deliver without extra duty paid.

“On the way back from Berlin, I stopped in Belgium to look at a new fulfilment centre location. We are going to have to keep stock in Europe; everyone at the show said they loved the bikes but importing from UK is too much hassle. I left feeling like a second-class citizen; this has been our biggest error since the Second World War.”

Quella enjoyed a third of turnover from sales within the EU; post-Brexit, said Mr Mellor. That figure now stands at less than five per cent.

“Sourcing is also the other side of the challenge. Nothing in terms of the parts we need is made in Britain.”

In 2019, Gloucestershire-based tech giant Renishaw, currently at number five in Punchline’s Top 100 Biggest Employers, announced its intention to shift warehousing over the EU border, to the Republic of Ireland.

The facility, at existing warehouse space owned by the firm near Dublin airport, is operated by the company’s existing Irish employees, although staff based within the Woodchester warehouse, near Stroud, were given the option to work with the new plan or be assigned to other activities.

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