A Brexit Nightmare

25 January 2021, 10:41 am
Speciality Bites by Paul Hargreaves

One of our suppliers, Cheshire Cheese Co, was in the newspapers at the weekend talking about their Brexit woes and that they had seen £250k revenues disappear overnight. They are not alone, and many small food and drink businesses are facing similar issues. At Cotswold Fayre, we stand to lose far more than that in turnover. Now we are in a good position so we will make that up elsewhere, but many small food and drink businesses are not in a good position at all.

The most remarkable thing of all is that small businesses are being advised by government trade advisers to set up separate companies inside the EU in order to get around extra charges, paperwork and taxes resulting from Brexit. So British government representatives are recommending redundancies for British workers here and jobs for those in the EU – how is a that a Brexit that is good for Britain?

The Prime Minister described the deal just before Christmas as a “frictionless” deal. What has actually happened is a deal with as much friction as incurred by doing a sliding tackle whilst playing football on Astro-turf, as I once found out to great pain. He also described it as a “cakeist treaty” implying that we can have our cake and eat it. The only cakes available here are Danish pastries covered in Belgian chocolate.

It is time for action. Please write to your MPs if you are affected by this terrible deal for the food and drink industry. Part of the text of my letter to the MP for our office address, who also happens to be the business secretary, Alok Sharma, is below:

“Whilst most of our business is within the UK, a small but growing percentage of the business has been until 2021 in the island of Ireland.  With the extra administration and charges incurred by Brexit, this business is sadly no longer viable for several reasons:

    • Irish retailers have lost all confidence in bring goods over from the UK – our largest customer for fresh products in Ireland cancelled all chilled deliveries in December.
    • The charges for processing goods are prohibitive for us.  As these companies charge per line of an invoice and we are shipping directly to retailers a broad range of products with up to 150 lines per invoices with only one or two cases per line, the cost of processing is close our gross profit.
    • Whilst we stock and distribute primarily British products, a number of our food and drink products are made in Europe, despite being branded for the UK, and, as a result, these will now incur duty due to ‘rules of origin’ making our business in Ireland even less attractive.  Understandably the Irish retailers are expecting us to pay these charges as we are the ones who have left the EU not them.

We are not alone in facing an imminent loss of business due to Brexit and the problem is exaggerated in the food and drink sector due to the low margin nature and relatively small shipments compared to other industries.  My colleagues and I have attended several cross-sector meetings organised by the FDEA and others over the past few weeks and the anger and annoyance about this Brexit ‘deal’ is palpable.

It is not a deal that helps anyone within the food and drink industry and will damage the British economy as 63% of British food and drink exports were within the EU in 2019.

As a member of the cabinet, what is your government going to do to mitigate this disastrous deal and the damage it is already doing in only three weeks to our sector and many others?

I look forward to hearing from you.”

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