Eight in 10 firms say Brexit caused 'biggest supply chain disruption'

29 November 2022

Brexit was voted the biggest cause of supply chain disruption over the last 12 months in a poll, as businesses say supply chains are on “life support”. 

Eight in 10 (83%) said Brexit had a bigger impact on supply chains than Russia’s war in Ukraine (76%), rising energy costs (71%) and Covid-19 (59%), a survey of 303 UK procurement leaders found.

The research, by Ivalua, found 80% of UK businesses said such black swan events had “left supply continuity on life support”.

Almost seven in 10 (69%) businesses said they were concerned further disruption will put suppliers out of business, and half (51%) fear they will go out of business. A further 83% said disruption had slowed down their ability to innovate and develop new products. 

Alex Saric, chief marketing officer at Ivalua, said: “These findings lay bare the significant toll of supply chain disruption on UK businesses. Supply continuity has been left on life support after repeated blockages and restarts, resulting in supplier failure and organisations struggling to onboard new suppliers to kickstart supply. With supply chains being shocked at shrinking intervals, organisations must work to future-proof supply chains.”

Increasing disruption resulted in almost three in 10 businesses (28%) reporting a loss in revenue over the last 12 months, with these businesses estimating an average drop in revenue of 18%.

Disruption resulted in products arriving late, leading to fines (68%) and reputational damage (64%).

The majority of businesses (72%) said they expect disruptions to last for at least six months, while almost a third (31%) said they would continue for the next year. Over half (59%) believe supply chain disruption has become normal, and that greater numbers of black swan events will occur going forward. 

Saric continued: “As black swan events accelerate, UK businesses must bolster resilience by ensuring they have total visibility into all suppliers, including tier two and three. Collaboration is critical too – supply chains are only as resilient as your ability to work with suppliers to mitigate the impact of any disruption.” 

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