A GROWING number of British online retailers are seeking to ease the extra customs and tax administration costs by shifting stock from UK warehouses to facilities on the Continent.
“The addition of VAT, customs duties, and in some cases tariffs, on shipments sent across the channel, not to mention delays at ports and increased shipping costs, are prompting many businesses, to reconfigure their European supply chains,” said Charlie Walker, marketing director of Walker Logistics.
By fulfilling orders from distribution hubs located within mainland Europe, UK exporters are able to avoid the need for their EU based customers to pay the VAT charges and customs duties which have been effective since 1 January.
“The changes to the tax regime are driving many online retailers to conclude that they have no option but to invest in distribution networks within the EU,” he said.
And it is not just British companies that are opting to use European warehousing: he believed US and Asia based traders who export to Europe are choosing to shift stock out of the UK too.
By bringing products that are produced outside the EU and destined for the European market directly into the mainland – rather than exporting to the UK and re-exporting to the EU, companies can make significant tax savings.
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