UK businesses hedge bets on Brexit stockpiling
Updated 22:49, 18-Oct-2019
CGTN
02:15

Horizon International Cargo is a warehouse that specializes in global shipping, logistics and supply chains as well as facing the challenge of planning for new customs regulations which may be implemented with a new Brexit deal. 

But despite the ongoing uncertainty, the president of the company's supply chain, Richard Perriman, says he has not seen businesses stockpiling ahead of Brexit, despite the uncertainty.

"Certain industries will need to, but others simply can't afford to," he says. 

"There are a number of factors – one is cash flow, tying up a lot of cash in inventory that you may not need is not something a lot of companies are willing to do. 

"Two, to hold product in the UK, we're not blessed with so much warehousing that we can do that, particularly if it's specialist warehousing for temperature-controlled goods, such as medicines and food etc. So, there's a limit to what we can actually hold."

However, some companies in the food and drink sector have been stockpiling. 

David Hogg is a sales director at London City Bond, a company that provides storage for wine traders. He said: "A number of our customers have stockpiled ahead of Brexit – both back in March and now again as the October deadline looms.

"This has put pressure on our warehouses, but as we have recently opened three new warehouses we are in a good position to cope with these demands."

He added: "In fact, other storage companies have approached us to enquire about short-term storage to assist them in dealing with the hike in demand for warehouse space."

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The National Health Service also said it has stored an additional eight weeks' supply of medical essentials at a vast warehouse in Wales, to prevent the public panicking and stockpiling medicines. 

But Perriman, who advises local companies at a series of Brexit talks organized by the Thames Valley Chamber of Commerce, said many business leaders feel they have not had clear enough guidelines from the government, making it difficult to plan stock levels. 

"I think there has been a lot of misinformation on both sides," he said. "And for people to see through all of that and actually get to the truth has been a challenge for them."

Perriman added: "Really, they need to look at their inventory levels, they need to look at the complexity of what they're going to now endure in order to move goods in and out of Europe, which they've not had to worry about before."

Mark Bunch, a UK EU trade leader at EY, says he has many clients that are preparing for Brexit in various ways.