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How Will Brexit Impact International Courier Services?

10 November 2017, 15:37 CET

In June 2016, the UK voted to leave the EU, and since then, speculation about the impact of Brexit has been one of the biggest topics of conversation amongst British businesses. This has only heightened since parliament triggered Article 50 earlier this year, which essentially started the divorce process.

Brexit has sparked fears across all sectors, including the housing market and education, but one of the most prevalent discussions has focussed around trade. The impact upon trade will depend on whether the UK opts for a 'hard' or 'soft' Brexit, where the former would mean leaving the single market altogether. For British businesses, leaving the single market could result in higher costs, as companies are forced to pay taxes and tariffs to trade across borders.

Transition Period

It is expected to take approximately two years to complete Brexit, but as the first country to leave the EU, there is a lot of uncertainty surrounding the outcome. As such, this means that while British businesses can do their best to plan ahead and forearm themselves, no one can be entirely sure how much of an impact Brexit will have.

For example, British businesses may have to deal with higher VAT, new trading regulations and customs, and restrictions on migration. As such, some fear that British exports could be affected.

However, there will be a period in which businesses can adjust. Theresa May has asked the EU for a two-year transition period in which British businesses will still have access to the single market. But with news that the UK will have to renegotiate more than 700 treaties, there is a lot of concern about how businesses will be affected.

Couriers Post-Brexit

The impact upon courier services will depend on several factors, the first being the European Economic Area. If granted a similar deal to Norway, which is not a member of the EU but does have access to the EEA, the UK will still be able to access the single market. If the UK is unsuccessful in securing such a deal, exports could be subject to customs processes and documentation, both of which take time and money.

While the price of customs and documentation would fall to the business exporting the goods and possibly to the consumer, this could mean long delays for international courier services, resulting in higher costs.

Furthermore, borders could cause concern for international couriers. Presently, because of deals with the EU, the British border in Calais is policed, but this could change post-Brexit. This would be detrimental to the British economy, as almost three-quarters of British exports and imports pass through the Calais border.

In addition, due to the logistics of shipping and the higher costs associated, there is a fear that Brexit could lead to a decline in trade, which could leave British couriers, struggling for business.

Until Brexit has been completed, experts can only predict how leaving the EU will impact upon British businesses. However, a hard Brexit could leave British couriers with higher costs and fewer customers.

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