Stone Group - Providing digital transformation solutions to organisations across the UK.

With so much uncertainty about how leaving the EU will impact different industries, businesses across Britain are getting ready for the unknown outcomes of Brexit.

Prices of trading goods have been fluctuating since June 2016, when the vote to leave the EU was announced. With goods having to pass through variable countries, distances, and currencies, the impact of Brexit has made a big impact on supply chains and could, therefore, have an even bigger impact on pricing along with possible delays in delivering stock after October 31st.

It is still unclear as to whether the country will be leaving the European Union with or without a deal, but we have acknowledged the potential for disruption in the wake of Brexit.

Stone takes action to maintain normal trading arrangements

In order to ensure our business remains sustainable, we have undertaken a range of risk mitigation actions designed to deliver the best possible outcome as the UK leaves the EU.

Stone continues to examine all potential outcomes and the impact they may have on our ability to maintain normal trading arrangements.

Risk assessments have been undertaken to assess the level of dependency on supply from within Europe for the current product offerings & specification ranges. Based on this assessment, Stone are progressing initiatives to mitigate, as far as practical, the potential for disruption to supply.

Project team to monitor Brexit development

To facilitate this, at Group level, we have established a cross-functional project team to monitor Brexit developments and to:

  • Identify, evaluate and address key Brexit risks;
  • Map our supply chain flows between the UK, EU and the rest of the world, shipment of finished goods, direct shipment of products to our customers via distribution centres, etc.
  • Identify key dependencies on EU sourcing within our supply chain, including our own suppliers who rely upon goods or materials from the EU.
  • Assess potential changes to the current frictionless movement of goods between the UK within the EU, the impact this might have on lead times and costs as well as the associated changes we would need to make to our trading systems and knowledge of customs processes among our teams.
  • Examine the impact of a “no deal” scenario and the imposition of WTO trade tariffs across the range of goods imported and exported to the EU.
  • Examine the impact of changes to the VAT regime, particularly the introduction of postponement VAT accounting on imports, the removal of Low Value Consignment Relief (LVCR), as well as the loss of triangulation arrangements and possible need to register for VAT in a variety of EU countries; and
  • Consider the impact on our people and current and future resource needs, but particularly the EU nationals that we employ to ensure they are supported and continue to be able to live and work in the UK following the transition period whatever the outcome.
  • Review internal stock holding capacity & budgeting requirements- Stone will increase stock levels across components within the Stone Desktop, Notebook and Server line up, including motherboards, memory and hard drives, where possible holding a further months’ worth of inventory in event of delays at UK ports.
  • Consignment Stock- Stone are the only UK SI to have successfully implemented a consignment stock agreement with Iiyama regarding monitor supply, this will allow up to two months’ worth of stock holding to overcome any delays from European shipments.
  • Working with the leading UK broadline distributors who are constantly assessing the appropriateness of inventory levels prior to January 31st.
  • Stone are working with supply partners to hold specific lines of product in addition our increased stock levels associated with the Stone product range.
  • We would encourage our customers to forecast in advance requirements related to non-Stone products. Configuration to order (CTO) will not be held in either Stone or distribution stock, customers are encouraged to consider switching to channel inventory specifications where stock levels be greater.
  • Account manager liaison with customers to encourage improved forecasting and longer order lead times.

*Find out how our Recycling team are preparing for Brexit.

Stone product supply

Stone has identified that the majority of components within the Stone product range, ship from the Far East directly into the UK. We believe there will be considerably less disruption for this supply chain route, but until it is clearer whether any new legislation, customer barriers and trade restrictions are put in place, we cannot confirm what the impact based on any Brexit outcome will be.

  • Active engagement with our International shipping agent (IFE) to monitor developments, identify express routes, border difficulties / localised shipping issues and changes to import systems (Eg. CDS)
  • Application for an AEO (Authorised Economic Operator Imports and Exports) and Transitional Simplified Procedures (TSP)
  • These provide benefits such as:
  • Faster application process for customs simplifications and authorizations
  • Reductions or waivers of comprehensive guarantees
  • Moving goods in temporary storage between different member states
  • A notification waiver when making an entry in a declarant’s records
  • A 70% reduction in a business’s deferment account guarantee

In summary, Stone is well prepared for whatever the Brexit outcome may be, we have sought assurances from our supply chain partners that they themselves are properly prepared and we shall both continually monitor the situation.

Contact one of our account managers today