Brexit’s impact lingers

ONGOING OPERATIONAL adjustments, handling delays and complex import/export rules have hampered the trade, particularly the movement of temperature sensitive goods, such as food exports which dropped 17 % in 2023, compared with 2019.

Companies have had to adapt quickly, often at significant expense, to maintain the flow of goods between the UK and the EU. While some of these challenges may diminish over time as businesses adapt, the long-term effects of regulatory divergence and labour shortages will likely continue to shape the logistics landscape into 2025 and for many years to come.

Brexit-related regulations have introduced a range of challenges for the freight and logistics sector, from increased paperwork and border delays to regulatory changes and cost pressures. 2025 will see more changes to rules and regulations, as well as procedures.

Delays, disruption as well as customs and regulatory amendments have all added cost increases to the supply chain. Brexit has contributed to fluctuations in the value of Sterling, which has impacted the cost of goods and services. Overall, the financial impact of Brexit on the freight and logistics sector and BIFA members has been multifaceted, involving increased costs, operational challenges, and strategic adjustments.

Operational barriers

Several areas within the supply chain have been overlooked or insufficiently addressed when considering Brexit regulations. These include services related to goods; digital services and data flows; specialised goods and niche markets; transportation of goods across multiple borders; the Northern Ireland Protocol and intra-UK trade; short sea shipping and smaller ports; as well as supply chain resilience and contingency planning. 

These gaps have created significant challenges for businesses, leading to disruptions and inefficiencies in the logistics and supply chain sectors. 

These challenges have been particularly detrimental to SMEs, which often lack the resources to absorb the additional costs and complexities. While larger firms may be better equipped to navigate these challenges through investment in technology and infrastructure, the overall financial burden on the industry has been substantial, leading to long-term implications for competitiveness and market access.

An area that requires more attention is e-commerce, where increased costs have reduced competitiveness in the global market. Also specialised sectors such as perishable/pharma and specialised sectors have seen added regulatory processes that cause potential delays.

Support for the sector

While Brexit has introduced significant challenges and barriers that may have lasting effects on the UK's logistics sector, there are also opportunities for recovery and growth. The UK's ability to rebound will depend on government policy decisions, investment in technology and infrastructure, and the resilience and adaptability of the logistics industry. 

By focusing on simplification, harmonisation, and cooperation, politicians in the UK and Europe can significantly reduce the friction caused by Brexit in the logistics industry. These efforts might include measures that simplify customs procedures; mutually recognise trusted trader schemes; improve border infrastructure, harmonise regulations; address labour shortages; facilitate digital and technological cooperation; promote dialogue and cooperation; revisit the Trade and Cooperation Agreement (TCA); as well as engage in constructive diplomacy. 

Such measures would not only ease current challenges but also build a foundation for more resilient and efficient cross-border trade in the future.

The UK government has now indicated a desire to invest in developing more skills in the UK, which we welcome as a longer-term solution. We have been banging this drum for many years and have an array of training courses and initiatives to encourage youngsters to consider and train for a career in the sector.

There are several political steps that could be taken to facilitate smoother operations in a post Brexit landscape. These include the streamlining of customs and regulatory procedures, infrastructure investment at key entry points and a mutual recognition of standards to name a few. 

That being said, ultimately it requires political will on both sides, despite the damage that has been caused, to reach agreement.

Plans for 2025

In addition to helping our members negotiate the post Brexit landscape in 2025, BIFA will continue to support its members through a variety of services and initiatives aimed at enhancing their professional capabilities, advocating for their interests, and ensuring they remain competitive in the logistics and freight forwarding industry. 

We will continue to enhance membership engagement in the new year. That will mean continued strengthening of its policy groups, including the recently established Sustainable Logistics policy group, which was created in 2024 to provide guidance on environmental issues that are likely to have an ever-increasing impact on members’ businesses.

In addition to our regular regional members meetings across the UK and Northern Ireland, and our quarterly Business Leaders Forums, which were established in 2023, the new year will see us hold our first national conference for many years. At the time of writing, we were in the early planning stages but it will take place at the Warwick Conference Centre on the 14th and 15th May 2025.

BIFA has partnered the organisers of the Multimodal exhibition and conference since its launch over 10 years ago. It is the main event in the calendars of most businesses involved in the UK freight and logistics sectors and attracts around 10,000 visitors. Our Forwarders Village will be centre stage once again in 2025. We will also continue to be very active within FIATA.

In 2025, The British Freight Service Awards will celebrate it 37th year recognising excellence and innovation within the industry, thereby motivating members to strive for high standards.

There will also be ongoing development of our training department  as part of the evolution BIFA will go through in order to best support our members and the industry. This will include career services to help members find qualified talent and support career advancement within the industry; as well as opportunities to attract young talent and provide hands-on industry experience

By offering these comprehensive services, BIFA will support its members in enhancing their professional capabilities, staying informed about industry developments, and navigating the challenges of the logistics and freight forwarding industry.

Steve Parker, director general, British International Freight Association