Logistical nightmares – Tesco prepares for the fall-out when grace period ends
Tesco passing the buck to suppliers avoiding Brexit complexities
Tesco is asking suppliers to carry food across the Irish Sea border, to ease the burden of supplying Northern Ireland once full checks begin in October – the end of the curent ‘grace period, according to a report in The Grocer.
Two suppliers said they had been asked by Tesco to start shipping directly from Great Britain into the Republic of Ireland, from where the supermarket will then transport their goods north of the border, according to the report.
Some suppliers are being told they may have to navigate the border themselves – with extensive and cumbersome paperwork required.
Tesco is set to adapt its supply chains, following the post-Brexit border arrangements, which impose checks on goods moving from GB into NI.
The ‘protocol’ is causing a range of headaches for businesses of all sizes – from pharmaceuticals to small deli suppliers.
Even M&S has said that the post-Brexit protocol has increased the cost of supplying Northern Ireland and Ireland has increased by £30m.
The complications will inevitably escalate after the grace period ends in October – hence, Tesco seeking to get ahead of the curve by being prepared.
Tesco says it aims to work with suppliers on the new arrangements.
The reality is that post-October 2021, if new arrangements or adapatations to the protocol are not in place, Northern Ireland is potentially facing a logistical nightmare.
Already there are indications that logistics companies are finding the new arrangements unworkable. Hauliers and logistics companies are working overtime to find ways to address the complexities involved.
Both jurisdictions in Ireland are important to Tesco. Kantar’s recent figures show Tesco topping supermakret share in the Republic of Ireland, and the supermarket is routinely the top performer in Northern Ireland.
While big companies like Tesco have resources to navigate the complexities, the costs could fall on the shoulders of small suppliers – and ultimately, the customer pays the price.
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