BREXIT Impact Assessment & Procurement Strategy
Are you prepared for Brexit?
Only 16% of businesses claim their procurement and supply chains are “fully prepared” for Brexit (CIPS Brexit Survey, March 2018).
With less than six months to go and no plan in place, UK organisations are facing an unprecedented degree of uncertainty.
Businesses have already been on the receiving end of cost pressure caused by foreign exchange following the Brexit vote and are facing further impacts from foreign exchange, tariff imposition, customs delays, VAT, restrictions on labour movement, data management requirements and legal complications built into existing supplier contracts.
Every organisation, whether private or public sector, should have a Brexit Procurement Strategy based on a robust, structured and researched assessment of their supply base, their sourcing strategies and their contracts.
Procura have developed a bespoke Brexit Impact Methodology which organisations can implement now:
Brexit Impact Assessment & Procurement Strategy - A four step approach
STEP 1: Spend data
We start with clear transparency of your complete supply base through up-to-date spend analysis.
Taking your data, we cleanse and categorise using our ProIntell Spend Analysis Platform, to start with a clear picture of your supply base; suppliers, spend, category, geography and currency.
Spend transparency allows for fact-based discussions, both with suppliers and within your organisation.
STEP 2: Suppliers
Having identified your key suppliers, we engage directly with them through a structured review to assess cost drivers, cost pressures, mitigation strategies, as well as any opportunities.
We work closely with key stakeholders to consider supplier-specific strategies, as well as understand the precise nature of the relationship with each supplier.
We identify where market risk, cost pressure and supplier concerns will impact to calculate the potential cost impact, and we provide actionable recommendations to mitigate risks and develop contingency plans.
STEP 3: Sourcing Strategies
In step 3, we review your current category strategies to understand category objectives, sourcing strategies and sourcing calendar.
We identify which elements will be impacted by the EU exit and, where this impact is significant, we provide actionable recommendations on how to take account of EU exit activity in your category plans.
STEP 4: Contracts
Finally, a clear understanding of contract risks is paramount. We review key contracts to identify risk areas and assess against our structured contract review assessment tool.
Risk identification is made against criteria such as currency, tariff, EU funding reliance and free movement of labour.
Key contract clauses are examined to understand termination, cost pressures, data requirements and continuity resulting from change to determine where further risks may lie.
We provide clear actionable recommendations and work with the organisations executive to develop a Brexit Procurement Strategy.
Thought leadership articles
One way or another – fundamental change looms for UK businesses Whatever the final outcome on March 29, 2019– be it a revised Chequers Plan, the Norway Deal, a customs partnership, hard Brexit, soft Brexit, ‘no deal’ or even the prospect of another referendum – the one certainty is the triggering of fundamental changes... Continue reading
Brexit – the perfect storm…? In the November 2017 budget, the GDP growth forecast for the UK was downgraded from 2% to 1.5% for the current year, with a challenging economic environment predicted in the run up to Brexit and beyond. UK based organisations have been feeling the pinch for some time. Following the... Continue reading