A quarter of small exporters cease selling to EU since Brexit transition end

A significant proportion of small exporters have stopped trading to the EU as shipping times have increased in 2021.

More than a quarter of small exporters have ceased selling to customers in the EU following post-Brexit transition delays.

The Federation of Small Businesses (FSB) warns that what might have been previously dismissed as ‘teething problems’ could become systemic.

A survey of nearly 1,500 small companies carried out by the FSB found that 23 per cent had temporarily stopped selling to the EU while four per cent had halted sales permanently. Eleven per cent of exporters were said to be considering a permanent halt.

The same proportion had set up or were thinking of establishing a presence in a European country to make the process easier. Around nine per cent may secure, or are already using, warehouses in mainland Europe or Northern Ireland for the same purpose.

Small importers have been particularly hard hit by new paperwork as 17 per cent temporarily halt purchases from the EU. What’s more, a massive 70 per cent of importers and exporters say they have suffered delays when moving goods around the EU in recent weeks. More than 30 per cent have lost goods in transit and a slightly higher proportion have had goods held indefinitely at EU border crossings. Of those who have experienced delays, more than a third have suffered hold-ups that lasted longer than two weeks.

There has also been a rise in people seeking help with paperwork. Over half of those surveyed required assistance with customs declarations, rules-of-origin paperwork and new VAT obligations.

The FSB urged ministers to monitor the rollout of the SME Brexit Support Fund closely. They want the Government to ensure that small businesses are aware that they can apply for funding to access a wide range of trading advice, training and technology – not exclusively to customs and intermediaries.

>See also: Where to find your £2,000 Brexit Support Fund grant

FSB’s national chairman, Mike Cherry, said: “Those that do business internationally are being hit with some incredibly demanding, unfamiliar paperwork.

“While larger firms have the resources and bandwidth to overcome them regardless, smaller traders are struggling, and are considering whether exports are worth the effort anymore.”

How long are shipping times now?

Research from forward2me shows that shipping times from the UK to the EU have increased since the end of the Brexit transition.

CountryAverage shipping time (days) - December 2020Average shipping time (days) - January 2021Difference
France 2.787.56171.94%

On the flip side, shipping times on UK exports to non-EU countries has decreased. Between December 2020 and January 2021, shipping times to Kenya fell from 12.75 days to five days (-60.78 per cent). Meanwhile, shipping times to Greenland have fallen from three days to one day (-66.67 per cent).

Read more

UK-EU exports fell by over 40% in January 2021

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Anna Jordan

Anna is Senior Reporter, covering topics affecting SMEs such as grant funding, managing employees and the day-to-day running of a business.

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