{"id":3080,"date":"2021-05-25T15:43:00","date_gmt":"2021-05-25T14:43:00","guid":{"rendered":"https:\/\/ilg-lin.gotest.it\/us-en\/?p=3080"},"modified":"2026-01-12T17:44:01","modified_gmt":"2026-01-12T17:44:01","slug":"brexit-and-the-road-to-poland-part-3","status":"publish","type":"post","link":"https:\/\/www.international-logistics-group.com\/us-en\/insights\/brexit-and-the-road-to-poland-part-3-3080\/","title":{"rendered":"Brexit and the Road to Poland – Part 3"},"content":{"rendered":"\n
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ILG Author Sam Taylor<\/a>Sam Taylor<\/a><\/span>25 May 2021<\/span><\/p>\n

Brexit and the Road to Poland – Part 3<\/h1>\n<\/div>\n\n\n

The twists and turns involved in establishing a warehouse within the EU.<\/h2>\n\n\n\n

Part 3 – The client\u2019s tale<\/strong><\/p>\n\n\n\n

Written in collaboration with Nick Pecorelli, Founder, Little Green Radicals.<\/p>\n\n\n\n

My business, Little Green Radicals, sells organic, Fairtrade clothing for babies and children worldwide. Everything is manufactured in India and prior to Brexit we brought all our stock into the UK, from where we could move it freely into the EU \u2013 no duty, no paperwork.<\/p>\n<\/div>\n<\/div>\n<\/div><\/div>\n<\/div><\/div>\n\n\n\n

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The UK and EU each comprise about 40% of our business and in Europe, Germany is our biggest market, so we decided quite early in the Brexit journey that we would want a warehouse inside the EU, preferably close to Germany. We started talking to ILG about a year and a half ago, before the original withdrawal was agreed.<\/p>\n\n\n\n

Nevertheless, the terms of the Brexit deal didn\u2019t become clear until this January. Suddenly we started incurring duty at 10%, delivery and fulfillment costs shot up because of all the paperwork, deliveries were delayed and additional charges started being levied on us and our customers that we had not been made fully aware of. It put us in an unsustainable position.<\/p>\n\n\n\n

So it made total sense for us to set up inside the EU as quickly as possible and fortunately ILG were working hard to get the warehouse in Wroclaw ready.<\/p>\n\n\n\n

Doubling Up on Orders<\/h2>\n\n\n\n

We had already started making changes in preparation. We knew there was the possibility of duty, so we had two orders for everything coming out of India, one for the UK and one for the EU. Any surplus will go to Poland where, being a bonded warehouse, we can keep it and only pay the duty as and when we need to bring it into the UK.<\/p>\n\n\n\n

But all this extra stock management has involved a lot of analysis. We now carry out stock analysis on a weekly basis, whereas before it was every couple of months. That\u2019s due to the sheer amount of stock we\u2019re having to carry overall, and that in turn will add significantly to our cost base.<\/p>\n\n\n\n

There has been a lot of additional admin too, like setting up VAT registrations in every country we\u2019re selling to, re-evaluating all our postage and delivery charges, working out with ILG which courier services could get to our customers and, on the basis of all these factors, deciding which countries we could viably sell to.<\/p>\n\n\n\n

Some countries present more difficulties than others and we\u2019ve had to vary our decisions from one country to another, such as whether we deliver duty paid or making the customer pay the duty. Each country has its own way of doing things and we\u2019ve had to learn as we\u2019ve gone along. It\u2019s taken a lot of time and cost.<\/p>\n\n\n\n

The Benefits of Keeping Stock in the EU<\/h2>\n\n\n\n

January and February were a turbulent couple of months. Our EU market had to shrink considerably, from 40% to 20-25%, plus we had higher costs and lots more work for the customer services team to do. But having a warehouse in Poland ameliorates all that.<\/p>\n\n\n\n

Brexit has increased the amount of bureaucracy we have to deal with and we have the complexity of split stock management, but being in Poland means we can shed those costs associated with moving stock from the UK and can provide a better service to Europe than we would have done historically. It\u2019s certainly quicker.<\/p>\n\n\n\n

Paradoxically, Brexit has forced us to invest in Europe, to put in extra resources and effort, to make the most of having stock there. We\u2019ll have a separate EU website and will do more business with Zalando, the German e-commerce platform.<\/p>\n\n\n\n

If we\u2019d had to do it all ourselves, the cost would have been prohibitive and the process would have tied us up in knots. To have a third party you\u2019ve worked with before do that for you is a massive relief.<\/p>\n\n\n\n

I think we have a good future. We\u2019re in a good place as a brand, we have a loyal customer base and I think we\u2019ll grow very well inside the EU. But it\u2019s certainly been hard earned.<\/p>\n<\/div>\n<\/div>\n\n\n\n

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Brexit and the Road to Poland – Part 2<\/a><\/h3>\n

Our decision to open a warehouse in Wroclaw, Poland, was signed off in September 2020 and I was assigned to manage the project the following month.<\/p>\n<\/div>\n

Read more<\/a><\/p>\n <\/div>\n <\/div>\n <\/div>\n\n \n

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Brexit and the Road to Poland – Part 1<\/a><\/h3>\n

In January 2020, with one year left until the UK left the EU, we made the decision to prepare a contingency plan in the event of a hard Brexit.<\/p>\n<\/div>\n

Read more<\/a><\/p>\n <\/div>\n <\/div>\n <\/div>\n\n \n\n <\/div>\n\n<\/div>\n<\/div>\n<\/div>\n<\/div><\/div>\n\n\n\n

Thinking of moving stock to the EU? We\u2019re ready to help you. Call ILG on 0844 264 8000<\/strong> or submit a contact form.<\/p>\n\n\n\n

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Contact Us<\/h3>\n\n\n