Brexit wins – what’s next for the procurement industry?
Milan Panchmatia, Managing Partner at 4C Associates has commented on the shock result that Britain is to leave the EU and the impact on the Procurement Industry
“Leave campaigners claimed that import costs will be significantly reduced (by as much as 8 percent) as we move to being a zero tariff regime. Possible. However, import costs are equally likely to rise or stay the same.
“Much of our imports come from the EU and these are unlikely to change. It’s unlikely that the UK will immediately move away from the international agreements that the EU has. It’s also likely that the administration of imports (everything from VAT to duty deferment) will become much more complex.
"What is certain to add more costs to business following this decision today, will be the associated decrease in migration and the increase in administration and regulation associated with business travel. There will be a clear increase in costs for products and services that depends on low skilled migrant labour (everything from contract cleaning to logistics and construction).
"This is also a decision that goes against the views of a large percentage of the procurement industry. Our recent monthly poll of 500 global procurement professionals, found that three quarters (79.5 percent) said they'd rather stay part of the European Union, 78.6 percent said they thought the procurement industry would be a harder sector to work in, 98 percent felt that leaving the EU would have a negative impact on procurement career opportunities in the UK.
"What was clear both from our poll and from conversations we have been having on a daily basis with clients and other procurement professionals is that leaving the EU presents new and unknown changes to business matters and it is likely that procurement functions within business will certainly see differences.
“Brexit will be the beginning of a long and unclear process and certainly not the end. It provides the possibility for the UK to run its own economy more closely in line with its own national interest. But it does not guarantee success.”
4C Associates is an award winning management consultancy specialising in procurement, savings delivery and managed services. Utilising market leading technology, processes and experts, the consultancy delivers best in class solutions to clients to a wide range of sectors including food & drink/retail; marketing; aerospace, defence and pharma.