After getting his start as an engineering apprentice in the mining industry, Robin Penny has been at the helm of family run hydraulic lifting equipment manufacturer Penny Hydraulics for three decades. In this article, he explains how Brexit might affect the British manufacturing sector and outlines how his business is preparing for it.
The agreed date for our departure from the European Union might be fast approaching, but there’s still a great deal of uncertainty around whether the UK will be able to secure a deal or not, what changes will be made to our supply chains as a result, and how businesses will be affected. There’s even a chance that our government could be granted an extension, which will further prolong this feeling of confusion. As a result, British manufacturers are having to make decisions based on what little information we do have, without any real idea of whether the moves we make now are truly going to benefit us in the long-run. But, we can’t just wait around for a final decision to be made — all UK businesses need to be taking steps to limit the damage that’s going to be done.
There are a number of areas in which we’re likely to be affected by Brexit at Penny Hydraulics. Firstly, because we’re putting the majority of our time and energy into preparing for Brexit, it’s preventing us from concentrating fully on other aspects of our business, like developing better products and providing our customers with the best possible levels of service. Of course, this should only be temporary, but it’s something we’re aware of, as we’ve always been proud of how we do in these areas. When you’re dealing with something as big as Brexit, other areas of your business have to take a hit, but we’re already looking forward to being able to concentrate on the things that have always mattered to us again.
Another issue we’re grappling with is that virtually all of the materials and components that we need to manufacture our products — from the steel to the fittings — are imported. And, while we do buy a lot from the Far East, I would estimate that around 75% of our materials come from Europe, which means we could be heavily affected by any new border controls that are put in place at Dover and Calais. The main way we’ve decided to prepare for this is by investing in new storage space, which we can then use to overstock, so we’re still able to provide our customers with everything they need immediately following Brexit. We’re hoping this will give us a couple of months of not having to worry about new border controls, and that everything will be much more stable once we start to run out of stock. We’ve written and published a blog post all about how and why we’re doing this, so be sure to give it a read if you’d like more information about these preparations.
We’re also keeping an open communication with our suppliers, so we can be sure that they’re prepared for any changes that might come into effect. Whatever happens, we know that we can expect some disruption, so we want to make sure that everyone we work with is on the same page so, when something inevitably does go wrong, we can all work together to find the best solution as quickly as possible.
Like many other British businesses, we’re doing our best to predict what changes might come as a result of Brexit, and we’re trying to limit how much we’re going to be affected. But, because there’s still so much uncertainty around what kind of deal we’re going to make with the EU and what the effects will be, it’s hard to be sure what the most effective course of action is going to be.
