Three-fifths of manufacturing companies in the UK stockpiled goods because of Brexit, according to a CIPS survey.
The survey, on the impact of Brexit on businesses, found 60% of manufacturers stockpiling finished goods and materials in the run-up to the original March departure date.
Due to the high possibility of delays at borders, a quarter (25%) of UK supply chain managers said they would withhold payments from suppliers until goods were received.
Two-thirds of companies (66%) said it would not be possible to replace suppliers in the EU with UK alternatives.
The continuous uncertainty brought by the Brexit deadlock has caused 27% of clients and customers to think twice before placing orders.
On the other hand, a quarter of manufacturers (26%) have decided to take action by re-negotiating contracts with suppliers in order to implement flexibility, such as a reviewal of prices following currency fluctuations.
John Glen, CIPS economist and visiting fellow at Cranfield University, said: “All this is not ‘project fear’. These are real costs that are being incurred because of the Brexit impasse. Politicians must make their minds up and get on with implementing a decision so that UK businesses can enjoy some certainty and start to plan for the future, no matter what the outcome of the political debate.
“A failure to do so will prolong the uncertainty resulting in the damage that uncertainty has on specific businesses, sectors and the UK economy as a whole.”
The findings from the CIPS survey were collected between 6-22 February 2019, and included 255 UK manufacturing supply chain professionals within the private sector.
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