How Will Brexit Affect Distribution Operations?

As the world waits to see how the UK’s referendum to leave the European Union will play out, companies with British and European distributions operations and customers face uncertainty about the future. Some industry observers estimate that $575 billion of annual trade between the UK and EU is at stake, and the impact of duties, tariffs, and other barriers to free trade across the English Channel may cause a significant dent in that figure.

While the UK prepares to activate Article 50 of the Lisbon treaty and begin the 2-year process of leaving the EU, it remains uncertain how cross-border trade will be affected. That said, many companies are considering ways to ensure seamless cross-border commerce while minimizing costs in the face of changing trade rules and regulations.

For some UK-based businesses, adding a distribution center in Europe may enable less complicated shipment of items to customers located outside of the UK. Without risk of delays due to tightened border controls, shoppers in Spain can shop online at a company based in the UK and receive overnight shipping from a distribution center in Germany. For companies that plan to house inventory both in the UK and in Europe, deploying Cloud VMS voice automation and Intellestra predictive analytics across multiple facilities can give decision makers at every organizational level an unprecedented understanding of how best to manage distribution operations for improved profitability.

Not only will Brexit restrict movement of goods but it will also restrict movement of people—which some experts suggest may contribute to a shortage of labor for distribution centers located in the UK. To help mitigate costs associated with training new workers, companies that deploy voice can benefit from shorter training and rapid time to proficiency for new associates.

At this point, most experts advise that business will continue as usual for the immediate future. While the long-term uncertainty means that many businesses may delay making decisions until the changes that result from Brexit become clearer, one thing is certain: those companies that have deployed voice automation technology and predictive analytics will be better equipped to manage their distribution operations by reducing costs and exceeding customer expectations, as well as being fully prepared for what the future in the UK and EU has to offer.

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