Brexit Committee News Update – March 2021 Update
Now we are approaching the end of Q1 2021, the reality of the Brexit agreement is emerging with the anticipated delays becoming apparent. As a responsible and proactive partner to our customers and suppliers, we have planned throughout 2020 to address all anticipated outcomes, and we are operating processes that allow trading in the UK and EU to be achieved in the most efficient way within the new regulations.
Despite continued pressure on the international supply chain through Covid restrictions, IT parts constraints, continued exceptional demand and varying interpretation of the new rules across Europe, our experience and preparation has limited these delays for our customers. Rest assured XMA is working with all of our customers to remain at the front of service innovation to remove these delays and will continue our Brexit committee and updates until we recognise that all trading conditions have returned to a consistent and effective
What has changed?
Our customers in England, Wales and Scotland
There will be no change in process from XMA, but we have ensured all of our Suppliers are compliant with all new import requirements to maintain consistency in supply and minimise any unnecessary delays at border points.
Our customers in Northern Ireland
The UK and EU agreed and implemented a solution to minimise disruption regarding cross border
movements. XMA have gained the specific EORI number (XI) to maintain our ability to supply our customers in Northern Ireland and we are also recording the commodity codes and country of origin of products supplied. For all customers in Northern Ireland we will require their EORI number and all deliveries will operate on a Delivered Duty Paid (DDP) basis under Incoterms as this remains a UK to UK relationship. Further information on the specific requirements for trading in Northern Ireland can be found here
Our customers in Europe
XMA have a UK EORI (Economic Operators Registration and Identification number) to facilitate the movement of goods into the EEA, which became a requirement in 2021. We also record the Full commodity codes and country of origin for all products supplied and now supply commercial invoices for all shipments. For all orders into Europe we will require our customers to provide their EORI number and all deliveries will operate on a Delivered at Place (DAP) basis under Incoterms.
The future
The biggest concern over Brexit was uncontrolled delays of products arriving into the UK or being delivered to Europe, and it does appear there are initial challenges whilst new processes are fully adopted by all stakeholder groups. Overall, XMA are confident we are providing our customers with correct and effective advice to minimise any delays. We will continue to monitor this situation and where any further risk of delays are identified, work with our customers to mitigate the risk or look at alternative solutions.
If you have any questions about how XMA can support your organisation post Brexit, please contact your Account Manager or direct enquiries to: approvals@xma.co.uk
Brexit Committee Update January 2021
Brexit Committee News Update – January 2021 Update
XMA welcome the news and certainty provided through the late trade deal between the UK and EU at the end of 2020. This has removed the unwelcome risk of tariffs on the products that could have occurred under WTO terms and allows for XMA and our customers to proceed into 2021 with confidence.
Whilst the trade deal removes additional adjustments, exiting the EU still provides changes in the way that products are imported into and exported from the UK, and XMA have ensured our compliance to all new trading requirements in 2021 to protect our customers from unnecessary delays.
What has changed?
Our customers in England, Wales and Scotland
There will be no change in process from XMA, but we have ensured all of our Suppliers are compliant with all new import requirements to maintain consistency in supply and minimise any unnecessary delays at border points.
Our customers in Northern Ireland
The UK and EU agreed and implemented a solution to minimise disruption regarding cross border
movements. XMA have gained the specific EORI number (XI) to maintain our ability to supply our customers in Northern Ireland and we are also recording the commodity codes and country of origin of products supplied. For all customers in Northern Ireland we will require their EORI number and all deliveries will operate on a Delivered Duty Paid (DDP) basis under Incoterms as this remains a UK to UK relationship. Further information on the specific requirements for trading in Northern Ireland can be found here
Our customers in Europe
XMA have a UK EORI (Economic Operators Registration and Identification number) to facilitate the movement of goods into the EEA, which became a requirement in 2021. We also record the Full commodity codes and country of origin for all products supplied and now supply commercial invoices for all shipments. For all orders into Europe we will require our customers to provide their EORI number and all deliveries will operate on a Delivered at Place (DAP) basis under Incoterms.
The future
The biggest concern over Brexit was uncontrolled delays of products arriving into the UK or being delivered to Europe, and it does appear there are initial challenges whilst new processes are fully adopted by all stakeholder groups. Overall, XMA are confident we are providing our customers with correct and effective advice to minimise any delays. We will continue to monitor this situation and where any further risk of delays are identified, work with our customers to mitigate the risk or look at alternative solutions.
If you have any questions about how XMA can support your organisation post Brexit, please contact your Account Manager or direct enquiries to: approvals@xma.co.uk
Brexit Committee Update October 2020
Brexit Committee News Update – October 2020 Update
Following XMA’s most recent Brexit meeting, we are delighted to submit an update to our customers and suppliers regarding our plans for Brexit. Our preparations are based on the assumption that there will be no European Free Trade Agreement in place by 1 January 2021.
Potential Delays
Whilst it is widely recognised that there will be delays at Channel ports and those heading to Ireland, XMA is working with our major vendors and distributors to mitigate such delays creating new routes of delivery. Whilst this will only be partially successful, together with XMA’s increased warehouse capacity and planning with each supplier – we trust that we can avoid any material delays. Consultation with customers have shown them to be more sanguine about these hold-ups which are unlikely to affect the normal flow of business materially.
Customers with orders due around 31st December should engage with your XMA account manager asap to ensure these can be managed and prioritised to ensure they delivered prior to cut-off.
Tariffs
Our vendors are improving their ability to provide accurate codes and countries of origin. 99% of XMA products now have commodity codes stored in our product database (or the UNSPC code which is a close approximation) and have been looked up on both the UK General Tariff and the EU Common External Tariff with almost all currently displaying no tariff. Some 3D printing products are affected.
These tariffs could change in the months ahead, and we will keep customers informed of any tariff introductions as soon as we can. Any tariffs incurred will be recharged to the customer.
Warehousing
XMA has progressed its discussions and application to have a bonded warehouse within the Andover facility. These preparations are continuing and our systems are being updated. This will allow goods to remain in Europe with the confines of our UK facilities and effectively be imported into the UK at point of order by UK customers whilst allowing European customers/orders to be transacted speedily.
Ireland
XMA can supply into Ireland through our parent company and main distribution partner Westcoast and we are able to utilise Westcoast Ireland’s own distribution agreements to purchase goods direct from our main vendors and then store in Westcoast’s Ireland’s Tallaght warehouse. This may help with large projects, run-rate skus and CTO/bespoke product orders. Please contact us for further details.
International Shipping
XMA are already experts in shipping to the EU – Ireland or Mainland Europe – and are working with a number of freight forwarders to provide services for all UK customers concerned about shipping internationally. Paperwork, tariffs, VAT deferment, regulations can all be handled by XMA’s specialist partners. The EU will be implementing full border formalities on 1 Jan 2021(the UK are phasing them in over 6 months) which means that customers need to be ready.
We will be announcing our standard processes shortly allowing any customer to engage our skills and services. However, if you want a more strategic conversation on how XMA can handle all such shipments on your behalf, engage with your account manager and our team will be in touch.
Other Changes
There are a number of other changes – e.g. the new UKCA safety mark replacing the EU’s CE mark or the recognition of professional qualifications and intellectual property. These internal Westcoast Group matters are being assessed and customers are advised to examine any areas that may be affected.
Two good external sources of information providing a checklist of areas to examine are:
Brexit Committee News Update – September 2020 Update
Welcome to the latest update from XMA’s Brexit team. Due to recent focus on Covid-19, XMA have not updated our Brexit page for some time. However, with the deadline for Brexit transition still due for January 2021, XMA’s Brexit Committee met this week and we can issue the current information / guidance below.
Whilst the UK has exited the European Union at the start of 2020, no real changes in trading conditions has been experienced as a result. This will not be true if the UK and the EU cannot agree a trade deal by the end of 2020. Recent reports have shown the Cabinet Office preparing for widespread disruption should such a scenario coincide with a second wave of Coronavirus in the UK.
XMA’s approach is to prepare for the worst and hope that the situation is considerably better.
Delivery Delays from Europe
Recent studies have shown that some delays at ports of exit/entry are likely. Given that the majority of goods supplied by XMA are currently imported into the EU via mainland Europe and shipped across the English Channel, such disruption is bound to have an impact. Hence XMA and our parent company Westcoast have taken or will take the following mitigating actions:
1. New increased storage – XMA’s new 346k sqft facility in Andover has been fully operational since the start of the year and has allowed increased space for XMA and our Customers; increased services (e.g. configuration, PDI, storage, bundling) and will provide reduced cost outsourcing opportunities for our OEM partners and Customers. The appropriate EORI number and TSP status are in place.
2. Short-term deals – Previous ‘false Brexits’ were covered by stocking deals with OEM partners to mitigate the immediate disruption to normal trade. XMA have already started working with Suppliers to ensure inventory planning over the change period.
3. XMA are working with freight forwarders, vendor logistics managers to ensure the smoothest possible importation through UK ports of entry. This includes correct commodity codes, country of origin information and paperwork.
4. Tariffs – Most (but not all!) IT products supplied by XMA in the last 180 days had no tariffs applicable on WTO terms or the UK Global Tariff (applicable from 1st January 2021).An accurate commodity code which allows tariff application to any goods imported is an important part of XMA’s work at present with Suppliers is encouraging them to provide a complete library of codes for every live sku. XMA are currently looking at automating a tariff look-up procedure to apply an appropriate tariff to the cost of the product if applicable. These can clearly change with little notice.
5. Other costs -VAT deferment costs, import management and transportation costs may also increase cost of goods after 1 January 2021 and will be applied systematically.
6. Finally, XMA and Westcoast are working with vendors to arrange direct delivery into the UK from the Far East (i.e. avoiding the EU altogether). Westcoast can act as a master distributor, importer or merely a 3PL provider to a wide range of suppliers.
Westcoast Exports
XMA and Westcoast now have warehousing in the UK and across Europe (inc Ireland). We are investigating the possibility of having a bonded capability in the UK for Irish goods and those for re-export to Europe. All Supplier contracts are being amended to allow for such transactions. We can manage the nuances of exporting to the EU including tariff application and shipping administration. Customers will be asked for standard information in advance of quoting whether the order is received by EDI, web or via Westcoast sales.
Ireland
The new Brexit arrangements for Ireland and Northern Ireland are well understood and we are working with our logistics provider/freight forwarder to ensure we minimise delays when delivering across the Irish Sea. There are no plans to enhance Westcoast’s current cross-stocking facility in Tallaght, Dublin.
Conclusion
Our recent Brexit Committee has reinvigorated our Brexit plans and the committee will meet every month in the run up to 31st December 2020 and will report back via ‘Brexit News’ every month. We will have updates on the progress of plans outlined above.
It would be easy to spend time speculating on what might happen as a result of the recent tumultuous events in Parliament – but XMA intend to focus on the practical measures the business is taking for our customers and suppliers. Most relevantly, the business is still preparing for a ‘no-deal’ Brexit on 31 October 2019 and ensuring we are as prepared as we can be for this date – whether or not there is an extension.
Imports
Most XMA suppliers are still in charge of their own delivery to XMA warehouses or to end-users directly. Many are finding new shipping/delivery routes into the UK ensuring that they might navigate delays at port of entry as best they can. The government have increasingly insisted that they are ready and will not create delays by stopping goods for customs checks on the border in the UK. XMA are working with all our major suppliers to smooth such entry procedures and understand their methods of shipping, including collecting goods from port on their behalf.
However, a number of vendors have changed their terms from DDP (Delivery Duty Paid) where the vendor (seller) is responsible for import duties/taxes and customs clearance to DAP (Delivered At Place) where XMA, the buyer, will be responsible for payment of duty and clearance. This may add cost to the product and customers should be aware that such terms have changed if they are buying directly from vendors. XMA are well prepared for this extra administration and will advise customers accordingly at the time of order. However, a key element of this extra cost will depend on tariff rates (see below).
Exports
Through our parent company Westcoast , XMA has access to an outstanding International Shipping team able to assist customers with all their shipping requirements outside the UK. The CBI are convinced that European markets are not ready for Brexit and will penalise/fine British exporters that do not submit the correct paperwork. Hence XMA’s main work has been centered around producing a commercial invoice on shipments acceptable to European customs detailing the appropriate commodity codes and country of origin where required. XMA terms will also be DAP and our goal is to take responsibility for your shipments up to Proof of Delivery stage ensuring the process is as streamlined as possible providing our usual excellent service.
Tariffs
In all, whilst XMA and Westcoast stock over 100,000 different skus, there are 570 different 10digit commodity codes – the majority of which currently do NOT attract any tariff to EU countries or most other export markets. This can change at any time and recent conversations between the USA and China show that the US are due to impose tariffs on technology products manufactured in China on 19 December 2019. (https://www.bbc.co.uk/news/technology-49644325). This is not the case in the UK but demonstrates that our industry cannot be complacent and assume that exports will never attract a tariff. These tariffs will be our customers’ responsibility to account for but we will able to advise customers on such tariff rates.
Provide an accurate quote
Advice of any country rules
Advice of any vendor rules
Gaining an understanding and confirmation in writing of use of goods
Provide all documentation specific to the country/product
Manage the process from quote stage to delivery
Set expectation on occasions end-user may see XMA’s pricing
Ensure their end user is able to import into country of destination
Ensure their end users are aware that THEY must cover customs duties
Provide correct end user details – full address and contact information
To advise what the end use of the goods will be
Import declarations
The important point is that XMA will help all customers with their international shipping requirements so please do not hesitate to speak to your account manager who will engage our shipping team.
Ireland
There have been some positive developments in shipping to Ireland since our last Brexit news. Every single shipment will attract an admin fee of €25 making single parcel deliveries uneconomic. As a result, XMA will be working with our logistics provider to ship all goods overnight from the UK on a single manifest and redistribute them from a bonded warehouse in the Irish Republic. This may add some cost and time to Irish deliveries but these will not be prohibitive.
Inventory
Our parent company Westcoast will once again be taking in approximately one month’s extra inventory for certain vendors during October hoping that this will sufficient to alleviate any short term issues arising. Clearly this is not a long term fix but Westcoast’s new 340k sqft warehouse in Andover – which should complete its fit out in October – demonstrates our commitment to hold more stock where required either pre-sale or post-sale. Our offer will include outsourced logistics and configuration facilities.
HPI’s Disclaimer for Commodity Codes
Please see what HP’s disclaimer for commodity code accuracy is. Expect all vendors and suppliers to adopt a similar disclaimer.
HP Inc. provides this data for informational purposes only. Classifications are subject to change and HP Inc. does not represent, warrant, or guarantee that the information is complete, accurate, or up-to-date. The information provided is not intended to constitute legal advice or to be used as a substitute for specific legal advice. Under the US Export Regulations, the US Government assigns your organization or client, as exporter/importer of record, the responsibility for determining the correct classification of any item at the time of export/import. In some cases there are restrictions that apply to exports based on the product, the end-user, the end-use, or the country of destination, and an export license or other authorization may be required prior to shipment. The Department of Commerce’s Bureau of Industry and Security provides a web site and can assist you with determining the need for a license or with information regarding where to obtain help prior to exportation. The URL is: http://www.bis.doc.gov.
Conclusion
Whilst it may be easy to worry about what might happen, particularly in light of the recent publication of Operation Yellowhammer papers, XMA are focused on helping all our customers and suppliers through the changes ahead. Our couriers have employed more staff and implemented systems and XMA have added layers of expertise, warehouse space and code/tariff checks to manage through predicted eventualities. Keep Calm and Sell On!
FAQ’s
How do you identify/manage controlled/dual use products?
Before we ship anything, we assess who the end user is and what the end use of the goods will be. We already expect the end user in country to complete an end user undertaking.
How do you prevent shipments to denied parties?
Such risks are highlighted to us by our carriers. We will then contact relevant customers to obtain further details and plan a way forward if possible.
Can you help with Export Licence Applications?
If the end-use is for military purposes, for example, we have the capability to apply for a licence through the correct platform.
Record keeping and audits?
We obtain the proof of export and POD for every shipment we do outside the UK. We conduct internal audits frequently and are audited externally.
For any questions or queries contact our XMA Brexit committee at approvals@xma.co.uk
Given that we have experienced a period of lull whilst the new government takes shape – the direction of travel now looks clearer – we are heading for a ‘No Deal’ Brexit at pace and hence all advice from government and business organisations is to prepare for a hard Brexit.
Seeing as XMA were making such preparations in March – management’s thinking is much the same and our Brexit committee met earlier to set out what we must do internally and to advise our customers on steps they can take to mitigate the effects on their business.
CBI & BCoC Advice
The CBI has produced a long document setting out the effects and the preparedness of the UK, the EU and the UK & EU together. A copy can be found here. In essence, it shows that the UK is better prepared than the EU but both are woefully under-prepared for 31st October. In addition, the fact that the new Brexit day comes at the height of the Black Friday and peak retail periods, poses more dangers for logistics businesses.
The British Chamber of Commerce has also set out a neat Risk Register as an update to their Business Brexit checklist.
This simple checklist will act as a good guide to ensure that XMA and our customers are considering the right areas to prepare for the difficult time ahead. Most areas are rated red.
People
Leadership is important here and XMA are ensuring that all EU nationals and their families employed by XMA are assisted in complying with the EU settled status scheme. We urge our customers and vendors to do the same. Perhaps the one area that the new government has softened is immigration, with no talk of reducing immigration but merely being able to control it.
Funding
XMA do not receive EU funds but this appears more positive for those that do.
Tax
It appears that the UK government will introduce a relaxed approach to VAT deferment on imports and exports for a period not less than 1 year. This will reduce any cash flow burden on XMA and hence our customers.
Regulation
Given that XMA and our parent company (Westcoast’s) goods are also sold in Europe, we do not anticipate any disruption to supply as a result of either UK or EU regulatory divergence post Brexit. Clearly this could change in the future but should not affect trade in the short term.
Data
The UK government will impose a limit on mobile roaming charges incurred in EU countries. This is not the case for EU tariffs in the UK. Data governance under GDPR has been adopted by UK law and is currently EU compliant. A ‘No Deal’ scenario is unlikely to alter EU data compliance although businesses should be alert for divergence.
Trade
There are still no tariffs anticipated on almost all goods and services sold by XMA under WTO rates at present. Clearly XMA will keep this under review in light of US/China tensions. However, neither the UK government nor the EU are likely to impose import tariffs on IT products.
Borders
This is where a ‘No Deal’ situation will have the biggest impact on trade. Whilst the British government are increasing spending on ports and customs officials as well as promising speedy entrance of goods from the EU, imports will still be dependent upon accurate paperwork. The Westcoast Group are spending time ensuring that appropriate information including commodity codes are available on shipping documentation. At present over 90% of codes have been collected and systems are being updated to ensure they are available when required. The EU have made no such arrangements and hence may well levy fines for inaccurate paperwork as they do for imports from outside the EU today.
Despite all the plans, delays at port are still anticipated by every logistics company that XMA have spoken to. XMA and Westcoast’s management are working with vendors to increase stock holding over the difficult peak period to avoid short term shortages. In addition, our new warehouse in Andover will more than double capacity and allow for increased stock holding. However, we urge customers to take the following steps:
i) Engage with XMA account managers to predict large roll-out orders in November/December to give earliest visibility to ensure goods are available in the UK.
ii) Switch selling from Configure-To-Order (CTO) stock built in vendor factories to channel inventory as soon as possible
iii) Where this is not possible, ensure lead times are managed with end-users to factor in delays at port
Ireland
Assuming that the UK exits the EU without a deal, the Irish market will be affected significantly given the border complexities. Westcoast’s warehouse in Tallaght is only sufficient for roll-out management and Westcoast do not anticipate making this into a fully managed warehouse at present – i.e. most goods will still be shipped from the UK and will be subject to border delays. Irish customers should engage with their XMA account managers to ensure stock held in Tallaght is forecast and distribution can be managed effectively.
FAQ’s
EORI – Westcoast do have a UK EORI number which will be sufficient for all declarations AEO – Westcoast have not applied for this status as management consider this will not be effective in speeding up customs procedures TSP – Westcoast have now received this accreditation from HMRC Warranty – No vendor has as yet amended their warranty terms so we can anticipate that warranty procedures will be the same as currently available post-Brexit VAT – Exports on goods shipped from the UK will not bear VAT from the UK as currently Tariffs – Where they exist will be applied on the full price of the goods (i.e. before discounts)
For any questions or queries contact our XMA Brexit committee at approvals@xma.co.uk
As UK Parliament move towards a crucial series of votes, HMRC are still advising businesses to prepare for ‘No Deal’. Below sets out some key actions XMA are taking before 29th March to prepare for such an eventuality.
It is worth pointing out that should a deal be passed by parliament in the coming days, the resulting transitional period lasting to at least Dec 2020 would mean that business would continue to operate as they do today with free movement of goods between the EU and the UK and would give XMA and its partners further time to prepare for any changes we would face as part of the final withdrawal agreement. We may face exactly the same issues we currently face or even a different set of issues for which we may have little time to prepare for. However, it will allow the Government to prepare more robust customs procedures and processes as well as negotiate favourable trade deals with both the EU and other countries.
Inventory
As mentioned in previous updates, XMA have negotiated increased one-off stock holding deals with its main hardware and supplies partners. This will result in a significantly increased stock holding. Whilst naturally not a long-term solution, it should mitigate any immediate shortfalls as delays at ports build up. In addition, we are advising customers to ensure they order channel stock as opposed to product built to order in EU factories to ensure the best service to customers. XMA have stepped up its services capability to configure locally to ensure end-users are serviced well during this period of uncertainty.
Customs & Border Control
Customs declarations will be mandatory for imports and exports for trade between the EU and the UK. Through our parent company (Westcoast) we are well versed in managing such declarations and have been busy collecting standard (UK will continue to be consistent post-Brexit) commodity codes (HS codes) for all live SKUs in our portfolio to understand whether tariffs will be applied. This work is on-going and to date we have confirmed codes on over 73% of active products in Westcoast’s catalogue. Any tariffs levied by the UK on imports or the EU on exports will be passed on to customers in the cost of goods along with admin fees levied by our customs clearance partners. At this point, we have identified very few risk areas, yet we encourage you also to take proactive steps to identify whether SKUs you wish to purchase from us could attract additional tariffs. Westcoast will inform customers when tariffs – currently at WTO non-preferential rates – are levied.
Safety and security declarations will be mandatory for imports and exports and Westcoast have a strong partner that will handle any such declarations.
It is mandatory for delivery documentation for goods being exported to show cost prices in order to clear customs effectively. Customers should note that whilst you may feel this is not ideal for direct deliveries to your end users, XMA must comply with all necessary customs clearance requirements.
We are only expecting physical customs checks on a small fraction of consignments particularly as not all ports have Border Inspection Posts (including Calais, Ostend and Normandy). All have plans to build new facilities, but it is not known whether these will be ready and sufficiently staffed in time for 29th March. Whilst we are not anticipating delays to XMA shipments, it will be checks on other products that bear significant tariffs that will create delays as well as the five-fold increase in HMRC custom declaration workload.
Ireland
There are likely to be delays in delivering goods to Ireland from the UK. Through our parent company (Westcoast) Ireland’s warehouse in Tallaght, Dublin, XMA will be have the ability to manage roll-out projects and cross-stock only. Customers are advised to discuss their project deals with their account managers to ensure appropriate space can be allocated. Single pick items will still be delivered from the UK using Westcoast’s logistics partner although some delays may occur at ferry ports.
FAQ’s
EORI – Westcoast do have a UK EORI number which will be sufficient for all declarations. AEO – Westcoast have not applied for this status as management consider this will not be effective in speeding up customs procedures. TSP – Westcoast have applied for this accreditation and the application has been acknowledged as received by HMRC. Warranty – no vendor has yet amended their warranty terms so we can anticipate that warranty procedures will be the same as currently available post-Brexit. VAT – exports on goods shipped from the UK will not bear VAT from the UK as currently. Tariffs – where they are imposed, they will be applied on the full price of the goods (i.e. before discounts).
For any questions or queries contact our XMA Brexit committee at approvals@xma.co.uk
With much heightened activity around Brexit, this XMA update is written following the sizeable defeat of the Withdrawal Agreement Bill in the House of Commons and the recent instruction that the Bill might pass if the EU agreed to significant changes in the backstop arrangements.
XMA’s Brexit committee can take no comfort in the UK Parliament’s stated desire to avoid a ‘No-Deal’ scenario on 29 March and continues to follow government advice to make best preparations for such an eventuality.
Key elements
Logistics
Much of the sector are highlighting the extreme difficulties that would arise in a ‘no-deal’ scenario including XMA’s parent company and main distributor (Westcoast) whose lead courier into Europe – Europa, state, that if either the UK or EU customs were not ready, this could lead to significant delays at channel ports. The majority of Westcoast’s and XMA’s import and exports come/go through Dover-Calais. At present, the likelihood of such customs readiness is extremely low and hence customers will experience both shortages and delays in receiving goods. Perishable goods are likely to get priority leading to greater delays for IT and consumables.
Many PCs and Servers are built to order in Eastern Europe and XMA are working with manufactures and customers to ensure forecasted products can be held locally in the UK. Our parent company Westcoast have purchased increased warehousing space to accommodate such requests and XMA are advising all customers to forecast demand beyond March 29 and engage with your XMA account manager to ensure XMA can place appropriate forward orders on your behalf. Post 29 March, XMA recommend that customers should attempt to order stock available in the channel and reduce their reliance on specific build to order devices.
Through our parent company (Westcoast), XMA are also stocking increased quantities of a wide range of products from major vendors that are realising their supply chain is likely to be disrupted. Whilst all vendors have been engaged, all have an array of plans to minimise disruption. However, many will involve XMA taking increased inventory which XMA are ready for.
As the OEM of Viglen Desktop PCs, Ultrabooks and Chromebooks which are assembled in the UK, XMA have established all known customer forecasts for 2019 and have pre-ordered components to meet projected demand plus anticipated additional demand in the event that supply constraints are experienced across Europe.
Ireland
Through Westcoast Ireland, XMA are able to deliver next day to the majority of the Irish Republic and Northern Ireland from the stock based in the UK. Whilst XMA are working with Westcoast to anticipate increased stockholding in its Irish facility in Tallaght, Dublin – this will be limited and hence Westcoast have a strong engagement with their delivery partner Primeline to ensure goods are delivered either through Dublin or Belfast, whichever is speedier. Delays are inevitable in their opinion though.
Much the above delays will lead to increased cost of delivery which Westcoast will incorporate into the cost of the product and pass onto customers.
Exchange Rates
This is the Brexit Committee’s biggest concern given the general indication is that the British ports and customs processes are not yet adequately prepared for a no deal Brexit. A small delay will potentially cause huge delays to goods deliveries in both directions and non-perishable goods will not be prioritised. As a result, we are looking to take the following steps:
Tariffs
XMA’s parent company Westcoast’s Data Governance Office are working hard with vendors to ensure commodity codes are accurate and stored so that all paperwork contain appropriate identification for customs to clear/obtain excise duty. Whilst there are very few products and regions that are anticipated to bear tariffs and Westcoast have not identified any on WTO terms at present – this may not always be the case. Accurate identification of goods will be critical and forms the basis of much of XMA’s / Westcoast’s work at present.
Paperwork
XMA and Westcoast will use outsourced freight forwarders to process paperwork/customs waybills. Most of XMA’s / Westcoast’s key suppliers are readying themselves for the increased workloads.
Incoterms
XMA receive most goods Delivery Duty Paid. If XMA become responsible for any duty or carriage – these will be included in the cost of the product and passed on to customers. Customers should be aware of any changes of terms from their suppliers and XMA will keep customers informed of any agreed changes and their effect.
Contracts
All key contracts cover the UK and no vendor with an existing all of EU and EEA contract with XMA has yet proposed a constriction to the UK only. All have expressed their intention to include the UK as a region on the existing contract
Whilst there is still much uncertainty, the significant short/medium term issue affecting XMA customers is delay at the ports. This will be mitigated with a signing of the Withdrawal Agreement and will allow the UK to build more robust custom procedures where required in collaboration with the EU. XMA will continue to lobby parliament through our parent company Westcoast.
For any questions or queries contact our XMA Brexit committee at approvals@xma.co.uk
