A general election is set in hopes to solidify the fate of Brexit
With the recent dissolution of the UK Parliament and upcoming general election to take place on December 12, 2019, the world economy continues to bustle, and US firms reel to forecast how these uncertain times will affect their supply chains. The new Brexit deadline granted by the European Union (EU) member states is set for January 31, 2020. There are a few outcomes that may be expected to shake out from the coming election 1) Implementation of the current withdrawal agreement; 2) Renegotiation/Referendum; 3) Cancel Brexit; 4) No-Deal Brexit. The election process will dictate which options are more likely to transpire.
So, what does it mean for US companies and their supply chains?
The US had a combined goods and services trade surplus with the UK of 18.9 billion in 2018 which translates to the US exporting 18.9 billion more in goods and services to the UK than it imports from the UK. The Brexit outcome regardless of what choice is made will undoubtedly cause uncertainty in the markets and will likely affect the exchange rate for the GBP. A weak GBP exchange rate makes buying US exports more expensive in UK commerce, adversely affecting US manufacturers, and the agriculture sector which makes up a significant percentage of the US export market to the UK. US companies should consider how the potential swing in GBP exchange rate may affect their forecasts in the coming years following the January 2020 Brexit outcome.
Globally, access to pharmaceuticals and cutting-edge scientific advancements are important in providing healthcare. UK based, GlaxoSmithKline Plc (GSK) is one of the top 10 pharmaceutical companies in the world, focusing a major portion of their business on oncology. The US market represents the highest percentage of their overall revenues. Instability in the UK could have effects on the US pharmaceutical industry. BluJay Solutions Transportation Management System (TMS) provides cutting edge technology for managing end to end global supply chain visibility, specifically engineered to manage fluctuating demand and sophisticated compliance needs. Taking the guesswork out of how your company handles change is key to weathering the storm with global trade. Shifting from reliance on manual spreadsheets and disconnected email exchanges to system-driven, fully integrated workflow management brings agility and strategic focus in times of disruption.
Michelle Frennier is Director, Solution Consulting, specializing in customs and compliance, at BluJay Solutions