Brexit Barometer 2019
Industry Findings
THE IMPACT OF BREXIT Despite the increasing preparedness of Irish food and drink companies in prioritising management of risks within their control, high levels of uncertainty regarding the impact of Brexit still prevail. This is by no means surprising, given Brexit Barometer 2019 British political developments over the last year.
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68% are uncertain around what the impact of Brexit will be
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22% are pessimistic about the potential impact of Brexit on their business
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10% are optimistic. These are primarily Prepared Consumer Foods businesses, who have identified a niche growth opportunity Industry Findings in Ireland, or are a sole/key supplier to the UK market. The company interviews indicated that certain UK retailers are working in partnership with their suppliers to ensure that they are as prepared as possible to deal with the consequences of Brexit.
bord bia brexit barometer
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This engagement is generally based on the UK customer’s dependency on the supplier and volume of
How optimistic or pessimistic are you about the impact of Brexit? REXIT preparedness amongst Ireland’s food and drinks imports within the category. By sector, 83% of Dairy & Dairy Ingredients companies have received Brexit questionnaires from their UK customers, as have 55% of Prepared Consumer Foods businesses. companies has risen to 93%, up from 74% in 2018. However, Brexit Barometer 2019 Industry Findings firms are increasingly concerned by the cost implications of UK MARKET GROWTH OPPORTUNITIES customs compliance and stockholding, potential weak links in logistics 10% Optimistic Looking ahead, the UK continues to be a very important market for Irish food and drink manufacturers, and many have halted investment plans due to the continued with 7 out of 10 companies planning to maintain or grow sales in the UK: uncertainty of the evolving Brexit landscape, according to the Bord Bia Brexit Barometer 2019: Results & Actions published recently. + 41% of respondents intend to grow their UK sales Bord Bia’s 2019 Brexit Barometer is the third in a series of annual 22% Pessimistic Given current Brexit challenges, intend protect/grow + 36% intend to to at least maintain their current levels studies that provide a comprehensive measure of Brexit readiness do you across Ireland’s food and drink with 130 yoursector, sales in findings the UKfrom market? + Of the 13% who plan to reduce UK sales, feedback from Bord Bia interviews indicate that this is a deliberate strategy by some of those businesses to diversify away from the UK. companies. It is the basis and risk diagnostic tool from which Bord Bia to Ireland’s largest indigenous offers a tailor made suite of supportsGrow UK Sales Maintain UK Sales Reduce UK Sales industry, which is uniquely impacted by Brexit. The UK accounted for 37% (+2%) of all Irish food and drink exports last year, amounting to 7 OUT OF 10 COMPANIES ARE PLANNING TO trade worth €4.5 billion. MAINTAIN OR GROW Informed by the findings from the 2019 Brexit Barometer, Bord Bia SALES 68% IN THE UK. Uncertain Primary Meats is moving into the next phase of Brexit support for industry, focusing on specific services and actions to prepare client companies, including upskilling on Commercial Marketing Strategy development, as well as Seafood Key Customer Management. This will complement new and existing Given current Brexit challenges, do you intend to protect/grow your sales in the UK market? training in critical areas such as customs compliance, logistics and Dairy and Dairy Ingredients supply chain and currency management. To date, Brexit related customers may be put under strain. 57% of Brexit will impact 86% of respondents. Of that companies who expect Brexit to have a medium total, 48% believe Brexit will have a high impact, support has been provided by Bord Bia to companies representing 13% Reduce UK Sales impact are in the Prepared Consumer Foods and a further 38% call out a medium impact to Prepared Consumer Foods to the UK. 72% of exports
Horticulture Emphatic Progress Made
Tara McCarthy, CEO of Bord Bia, said that the 2019 results point to a year of emphatic progress as Ireland’s largest indigenous industry preparesAlcoholic for one ofBeverages its most significant challenges ever: “With 93% of food and drinks companies that responded to the Barometer, representing 72% of all UK exports, makings plans and taking action, 0 levels of engagement 10 20 to two 30 we have witnessed transformative due interlinked factors: firstly, the expectation for much18of 2018 that a negotiated agreement was finally in sight and, secondly, the return to prominence of a ‘cliff edge’ no deal Brexit, which remains a looming threat. This experience left Irish exporters in no doubt that their future trading relationship with UK customers should be managed as a priority.
Don’t sector. The companies10% that are of know the view that Brexit will have a low impact (14%) have a relatively lower level of export dependency on the 36% Maintain UK Sales UK market.
their business. Companies that expect a medium impact have put in place robust systems to manage any potential costs and complexities that may emerge from logistics and customs. They are also looking to new markets but are conscious that their service levels for UK
41%
40
50
60
70
Grow UK Sales
80
Alcoholic Beverages, andintend Prepared Consumer Foods are the leading sectors in terms of Given current Brexit challenges, howHorticulture do you intention to grow sales in the UK. to protect / grow your sales to the UK?
Low priority
Medium priority
High priority
New product development Enhanced key account management New channels Enhanced commercial marketing strategy Placing staff resources in-market Market research Attending trade fairs
0
10
20
30
40
50
60
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