Quarter of UK supply chains hit by Covid and Brexit disruption

11 March 2022

A quarter (26%) of medium and large firms have been affected by supply chain disruption due to Brexit and coronavirus, according to ONS figures.

The ONS's UK Business Insights and Conditions Survey, which covered impacts of coronavirus and Brexit, found 5% of UK firms had switched to UK suppliers or EU suppliers with UK operations. Many were diversifying their supply chains generally.

Almost one-third (30%) of businesses in manufacturing and wholesale and retail trade reported being impacted by global supply chain disruption. Many businesses stated they were reshoring supply chains and increasing diversity.

One in 20 (5%) UK businesses reported they had made changes to supply chains because of the end of the Brexit transition period. Excluding small firms (defined as up to nine employees), around 8% of businesses said they had made changes. The highest proportion which had made changes to supply chains were within wholesale and retail trade (9%) and manufacturing (10%).

More than half (58%) of businesses overhauling supply chains reported they were using more UK suppliers, down on 71% earlier in the year. 

According to the survey, these changes “imply re-orientation from foreign to domestic suppliers, particularly in the wholesale and retail trade, and manufacturing industries”.

The report added: “There is some evidence that respondents have increased the diversity in suppliers over time.”

Additional Brexit UK border checks are due to be introduced in July for all products of animal origin. 

Andrew Opie, director of food policy at the British Retail Consortium, said in a blog: “We are now in the final countdown to UK border controls. From July food imports will require full paperwork and lorries will be stopped to check consignments. To avoid congestion and disruption to your supply chains it is important your EU suppliers are as prepared as possible.”

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