Opinion

How is the supply chain preparing for life after Brexit?

27 February 2020 | By Paul Lonergan

Construction’s suppliers anticipate change now Britain has left the EU – but feel the industry needs to move with the times anyway, say Paul Lonergan.

Paul Lonergan

With the UK now officially no longer part of the European Union, many within the construction industry are waiting to see the impact of Brexit upon our businesses. 

With this in mind, RLB UK recently ran a supply chain round table to ask those at the beginning of the design and build process about how they were preparing for life after Brexit. Companies that attended represented the building services, fit out, brickwork, demolition and structured cabling sectors.

There was no surprise that the majority felt they had been ready for the UK to leave the EU, with robust plans in place for Brexit within their business. Although the shortage of labour was still a concern for many in the industry, the general consensus was that the forces of supply and demand have naturally evolved, with many organisations now seeing an influx of nationals from other countries supplementing the labour force, particularly from Asia. 

This sparked a discussion around how the industry still had an image problem and about construction not being seen as an attractive career choice in schools and Further Education institutions. There was resounding agreement that we need to address the possible labour shortage and attract and retain candidates to the industry.

“Most were positive about trade in the year ahead post Brexit, with the participants giving a 7-9 out of 10 on an optimism scale for the 12 months ahead.”

Most were positive about trade in the year ahead post Brexit, with the participants giving a 7-9 out of 10 rating on an optimism scale for the 12 months ahead. Many had already seen an increase in enquiries and tenders as the market had heated up but also a surge in the number of companies involved in the procurement process. Many of those around the table said that they are often competing with up to 12 other companies for each project. 

For those organisations that worked in the EU pre-Brexit, an interesting point was made about the movement of materials post Brexit. Currently many of them are using the UK as an import and distribution hub, with materials passing back and forth between the UK and EU countries several times as part of the distribution process. There were concerns that this process will become cumbersome and expensive in the future.

Other observations and challenges that were raised in the supply chain round table included the advance of technology in construction, which the participants believed had brought its own challenges as well as opportunities – with technology only as good as the person operating it and a risk of losing vital skills through automation within projects. 

There was a general feeling that modern methods of construction and offsite manufacturing were now par for the course for many in the supply chain, driven by a desire for efficiencies, reduction of waste and increase of speed in projects.

There was a feeling of change, but in many cases this was seen as the evolution of an industry needing to move with the times – rather than being enforced by the UK’s departure from the European Union.

Staying close to the supply chain helps us understand these complexities, the changes that are taking place and provides an educated insight to what is happening across the whole design and build process. It is essential we continue to work collaboratively, listening to those who we work alongside to bring the best outcomes to our clients.

Paul Lonergan is a partner at Rider Levett Bucknall

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