How Brexit will affect the foodservice equipment market
Nick Oryino, technical consultant at the Foodservice Equipment Association (FEA) outlines the issues facing the sector as we approach Brexit in January 2021.
Brexit: deal or no deal? It looks like it's going to the wire, which is exactly what Michael Portillo told the foodservice industry to expect, back in 2017 at the FEA Conference.
Either way, after January 2021, getting hold of equipment that's manufactured in the EU will have more processes and reporting involved, and this will have an effect on cost and availability.
Consequently, suppliers are gearing up to minimise and, if possible, eliminate any disruption to the supply chain.
Importers will have more red tape to get though, more reporting responsibilities and the way things are going, they'll probably have to pay tariffs. No doubt many importers will try to absorb some of the extra costs, but they won't be able to cover them all.
While we have been assured of a ‘soft landing' at the end of the transition period, in relation to the new border crossing procedures, concerns about potential delays have led some companies to say they won't try to move goods across the borders for the first few weeks of January, until the systems and processes have been implemented.
Then there are the added complexities of new regulations and legislation. In the short term, there will be alignment between UK and EU laws. But even from 1 January 2021 there will be changes that foodservice operators need to have on their radar.
For example, we're all familiar with the CE mark that you see on goods sold in the EU. It confirms that they are safe to use and conform to specified health and safety and environmental standards. As of January 2021, the UK will have its own version – the UKCA mark – which suppliers will need to affix to their products, alongside the CE mark. Until January 2022, CE-marked products can continue to be sold in the UK, but after that they'll have to have the UKCA mark. You can expect to see one, the other or both on products from early next year.
The Irish question is going to make things complicated, too. For example, for any products newly placed on the UK market, EU flags will need to be replaced with Union flags following the end of the transition period. However, as things stand, products placed on the Northern Ireland market will be required to meet EU regulations (ie, bear an EU flag, not a UK flag), under the terms of the Northern Ireland Protocol.
Some EU foodservice appliances that are sold in this country come in via dealers, who act as UK sales representatives for the manufacturer. After January they'll need to register as importers if they are to continue to bring in the products. Will they want the hassle? If not, then getting hold of the product range and finding spares and replacements may well get more difficult.
Last but by no means least, most economists predict tough times for sterling if we leave the EU with no deal. A lower value pound means that the cost of imported goods will rise. Even appliances manufactured in the UK may incur price rises if they use components made outside the UK – which a great many do.
Product movement challenges, regulation changes and currency implications… Worried and confused? Well here's the bottom line: if you're thinking about investing in equipment, save yourself some bother, and possibly some money, and do it before 1 January 2021.
