It may have taken a backseat while the world has been grappling with the coronavirus, but Brexit is still looming on the horizon. The deadline for the UK and EU to agree on the terms for the UK’s exit from the Union – 1 January 2021 – is fast approaching, and it’s time for retailers to take steps to ensure a smooth transition for their delivery supply chains.
The impact of Brexit on ecommerce
There’s still so much that’s unclear about the exact terms of Brexit, but there’s one thing for sure – ecommerce delivery between the UK and mainline Europe will be impacted. As the UK exits the single market and the European Customs Union, the movement of goods will be subject to new customs checks, new regulations, and likely some new custom duties.
Step 1: Update delivery data flows
The biggest change anticipated for January is the shipment data the retailer must provide to the relevant customs authority. This applies to goods travelling from the UK into the EU, and vice versa. What this means in principle is simple: updating the data flows of your customs declarations. What this means in practice will really depend on the different parties involved in your supply chain.
Anyone operating in the dynamic field of international ecommerce knows that fulfilling orders across borders is a complex task requiring input from a vast set of partners and providers. Some retailers work directly with carriers or customs brokers, so in this case they will be responsible for updating this data flow themselves. This could mean producing new file formats, or even interfacing with new systems. The common changes carriers have been requesting from us as a delivery technology provider are adding new fields to the manifest and new logic governing parcel flows between the UK and Europe.
When it comes to the data itself, one reassuring fact is that the requirements for international trade outside of the EU are overwhelmingly similar to those inside it, so information required for trade with the UK will likely follow suit. This generally includes requirements like product description, HS code, value, and weight. The UK Government has also indicated that an EORI number will also be needed. Generally speaking, any retailer that passes the same data for European shipments as it does for the Rest of World shipments should be in a good place.
Step 2: Check allocation rules
Things are slightly easier when a retailer can lean on a delivery management provider to optimize the fulfillment process for them, although some further steps should still be taken independently by the retailer to ensure a smooth transition come January.
For example, here at Metapack we will update the way our own system positions the UK outside the EU trading block once the new rules come into effect. However, we do still recommend that retailers check the allocation rules applied within the system to ensure that the correct carrier service is selected when the UK is no longer in the EU. Many retailers have allocation rules that select carriers based on destination country or trading block, which will need to be altered to reflect the new regulations.
Also be aware that in some cases carriers contact retailers directly for customs-related information, for example incoterms, HS codes, and product descriptions. Retailers should ensure that the information provided is in line with the data in the manifest generated by their delivery management system.
If you partner with a delivery management provider, it might even be possible to test the flow of customs data ahead of time. For example, on the Metapack platform, manifests can be generated in the Sandbox, although they do need to be sent to carriers for manual checking.
Step 3: Plan for the unexpected
Be sure to allocate time and resources to handle unexpected changes. For example, we are expecting a further round of changes to our own platform once regulations surrounding Northern Ireland customs become clearer. It is not yet clear whether something like customs entries will be created, but it’s likely that carriers will begin to capture the full international trade data set (weight, value, commodity, etc.) in their manifests, just in case.
From the point of view of the retailer, ensuring you have a large network of carriers to draw from will also ensure minimal disruption in case delays or unavailability should arise at any time throughout the transition.
What does Brexit ecommerce readiness mean for Metapack?
Metapack has issued guidance to our customers about data requirements when the UK exits the European Customs Union. We are also in frequent contact with carriers, and are working with them closely to ensure a smooth transition for all parties.
Most of the changes we must undertake within our own system are already cued up to take effect on Day One. However, there are some changes related to the composition of the EU Trading block which cannot be made until the day itself. Our customers will be provided with a specific timetable closer to the date, which will also include details about additional support.
If you need support with your Brexit ecommerce readiness, we would love to help. Please reach out to your Metapack account manager, or get in touch with us here