A survey has been carried out of 1,118 supply chain managers, and 63% of them have said that they expect to move some of their supply chain out of the UK. This figure has increased from 44% in May. as many as two thirds of EU businesses, including food and drink manufacturers have said that they intend to move their supply chain out of the UK.
These companies have said that they will be moving their supply chain because of Brexit. The survey, carried out by the Chartered Institute of Procurement & Supply has also shown that 40% of UK companies that have EU suppliers at the moment have started to look for domestic suppliers, and 26% have said that they will be investing more time in to strengthening their relationships will suppliers on the continent.
This change in the figures has also taken place following the gradually decreasing optimism of Brexit talks. Half of UK businesses have said that they were becoming less confident that a deal to offer free and frictionless trade between the UK and the EU will be reached. 35% of UK businesses that responded to the survey said that they felt unable to prepare for Brexit because of the lack of progress that has been made on a future trade relationship.
The Government have said that progress will be made soon however, for a large number of businesses this progress will be too little, too late as they face abandon from their European partners. Businesses are unable to put their customers and suppliers on hold while the negotiators seemingly get nowhere, and a lack of clarity and openness is not improving the confidence levels of British businesses, such as those in the food and beverage manufacturing industry.
It has been recommended that those in the food manufacturing and retailing sectors need to start to prepare their plans for a hard Brexit, a situation where Britain leaves the EU without a deal.