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Blog: How supply chain managers can keep everyone happy

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As I mentioned in my previous blog, as Business Development Manager at IDS I spend much of my time talking to professionals with some kind of involvement in the logistics sector... and around 75% of those experts are supply chain professionals.  

What continues to fascinate (and sometimes frustrate!) me is that, no matter which sector they are in – from manufacturing and chemicals to agriculture and consumer packaged goods – they all face very similar challenges.  

Firstly, they are continuously battling to keep costs down, often feeling caught in the middle between their colleagues’ conflicting demands of budgets/profit targets and service level performance.  

Secondly, despite the abundance of data, they struggle to gain relevant insights (e.g. who is the best and most cost-effective carrier for the product/volume/route/lead time in question?) quickly enough. This makes it difficult for them to make the right operational decisions to keep everyone happy (see challenge 1 – costs versus performance).  

Thirdly, companies are placing a growing importance on sustainability and Supply Chain has a considerable impact – which means the onus is on the supply chain manager to come up with solutions for reducing packaging, waste, the carbon footprint and so on in line with the environmental KPIs.  

And last but not least, supply chain managers lack sufficient time to do all of this properly – let alone to get to grips with new technologies such as blockchain, the Internet of Things (IoT), artificial intelligence and robotization, all of which have the potential to further improve efficiency. 

The good news is, at IDS we support supply chain mangers in tackling all four of these challenges. With our help, you can build a future-proof supply chain revolving around agility, scalability and controllability. Thanks to our standardized processes and advanced IT systems for managed transportation services, combined with our neutrality and thorough knowledge of national and international transport markets, we can quickly and flexibly select the best carrier with the right specialization for each situation. This maximizes your transport synergy to improve your performance level while also reducing your supply chain costs – sometimes by as much as 15 to 20%. 

How? Well, our automated simulation tools reveal ‘quick wins’ that can be achieved even with your limited time and resources. This can involve things like the smart consolidation and combination of shipments, streamlining of the invoicing process, systematic processing of disputes and claims, or letting us take care of your carrier management and transport contracting activities.  

We can also improve your visibility into all the data, either by setting up an automated connection between you and IDS or by providing you with regular management reports to analyse your order/shipment levels, costs and carrier performance. Either way, you gain more transparency and a sound basis for data-driven decision-making.  

On the topic of sustainability, we manage the carrier network and consolidate your shipments to create more full truck loads (FTLs) and better reverse logistics. This not only saves costs, but also reduces CO2 emissions in your supply chain. In fact, our certified CO2 reporting tool, developed in collaboration with Eindhoven University of Technology (TU/e), enables us to report CO2 data at any required level of detail (e.g. per shipment or per destination). 

By helping to tackle the first three challenges, we ease the burden on you – which automatically helps to solve the fourth challenge: time. And wouldn’t that be great?! Extra time on your hands to think about how emerging technologies could help you to further improve your supply chain efficiency in the future.

 

Contact me to discuss how to take the first step towards keeping everyone happy – including yourself! 

 

How tenders can help you to cope with uncertain times

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This summer, Brexit and the trade war between the USA and China have dominated the business news headlines. At the same time, the economy seems to be stagnating and the labour market remains under pressure. All of these uncertainties have one thing in common: they will most likely cause transport costs to rise in the years ahead. This is a good reason to carefully review your current suppliers and existing contracts, and perhaps even to issue new tenders in the search for partners who can help to further strengthen your supply chain. Or are you holding out and hoping the storm will pass?  

  

It all starts with insight 

Nothing beats issuing a tender as a way of gaining insight into the market conditions. From price-quality ratios and volume discounts to surcharges and exceptions… the tender process gives you a unique opportunity to compare multiple suppliers on multiple levels. But to be truly effective you need to make a fair comparison based on clear objectives. That starts with having insight into your own ordering process, routes, delivery addresses, volumes, frequencies, variation and exceptions. At IDS we help our customers to extract this data from their IT systems and analyse it correctly, so that everyone has a realistic view of the situation. 

 

Ideas for improvements 

The insights that you gain by gathering and analysing the data often generate ideas for improvements before you even get as far as a tender. For example, you might decide to introduce line hauls to hubs, or to improve your customer segmentation to reduce the number of shipment days. Alternatively, should you start taking freight exchange platforms into account, and if so can they be integrated into your existing workflow? 

 

Quality matters too 

At IDS, we regularly help logistics managers to translate the resulting insights and ideas for improvements into a clear tender with concrete selection criteria and preconditions. Increasingly, the long-term effects of lower carbon emissions and horizontal supply chain integration are key factors in that process. But in the current market conditions, capacity management and risk management as well as high-quality and reliable customer service sometimes matter just as much as the price, if not more so.  Thanks to our knowledge of the logistics sector, we can help you to emphasize the right aspects in your tender request to ensure you can cope with the volatility.

 

Multiple roles 

As a 4PL supplier we are an independent supply chain partner. Hence we always go in search of the best transport solution for each customer, without being burdened by restrictive contracts or our own assets. In tender processes, we put our experience along with our data analysis to good use in various ways. For example, it’s up to you whether our tender experts take care of the entire process for you or limit themselves to just writing a sound project plan, including all the necessary documentation. Alternatively, you can task us with evaluating the tender bids, drawing up a list of potential suppliers or promoting the tender in the market. The result is an optimal mix of different suppliers with whom you can collaborate smoothly, even in uncertain times. 

  

Reaping the benefits  

After signing up new suppliers, the use of the IDS order platform to exchange information between you as the shipper and your new service providers ensures a trouble-free transition and subsequent operations. Once you have the order instructions, performance reports and invoice control at your fingertips, nothing will stand in the way of you reaping the benefits from the tender. Besides that, you will be in a perfect position to provide your customers with guaranteed service, despite the current uncertainty.  

 

If we can help you with your tender process or you would like to know more about our extensive data analytics capabilities, please contact Arno Spoek: arno.spoek@idsnl.com.  

 

 

 

  

A carefree vacation

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Aromatic lavender fields, sunshine and quality time with friends and family at last… with the holidays just around the corner, many of us catch ourselves daydreaming at our desks at this time of year. But it can be difficult to enjoy a carefree vacation when you know that staffing levels are at a minimum and the work continues to pile up. And that problem is not only limited to the holiday period, because the labour shortage poses additional challenges. The continuity is under growing pressure – and that’s enough to cause sleepless nights, with or without a heatwave. So how can you safeguard the continuity of your supply chain when resources are tight?

 

Linchpin

One of the most common solutions is a transport management system (TMS). A TMS serves as a linchpin ensuring the continuity of the logistics process. It connects freight flows to shippers and carriers, and improves the efficiency of order processing, planning, invoicing and communication. With numerous satisfied customers in the manufacturing, chemical and processing industries, at IDS we have clearly demonstrated that our TMS is also – and perhaps primarily – suitable for managing complex supply chains. Our TMS really proves its worth when shipment volumes, weights, frequencies and (international) destinations are constantly changing.

Supply chain specialists

At our offices in Utrecht, a team of supply chain specialists work in close collaboration with everyone concerned (customers, carriers, logistics service providers and other partners) to manage your transport activities. They have access to real-time information about all your shipments as well as the transport options. They draw on their knowledge and experience to warn you in the case of unexpected developments and to advise you on faster or more cost-effective solutions. And, if you wish, they can even handle your entire logistics process for you – either temporarily or permanently. Now that’s what we call ‘carefree’!

Keeping hold of the reins

If you prefer to keep hold of the reins yourself, a TMS makes it easy for you to process and check transport orders. It helps you to tidy up your file management and calculate rates, plus it gives you access to various freight audit and invoice control applications, including self-billing and an electronic freight audit tool.

Saving costs

The TMS selects the most efficient transport solution for every shipment, whether national or international, resulting in significant cost savings. We summarize these savings for you in a monthly report.

Visibility

Lastly, the TMS ensures that more data is available, faster. You can access weekly, monthly or quarterly reports showing details of your freight flows, CO2emissions and/or customized transport activities. And because you receive this information quickly, you can gain rapid new insights into other areas of the supply chain where things can be done better, faster and cheaper.

So what about the continuity?

In addition to saving external costs, a TMS also enables companies to handle more work with fewer people. The TMS speeds up procedures and enables you to provide better service thanks to the up-to-date information. A reliable transport management system not only gives you peace of mind, but also safeguards the continuity of your service offering. Besides being reassuring during the holiday period, that opens up opportunities for further growth once the summer is behind us again.

 

To learn more about the IDS transport management system, contact Arno Spoek for a thorough discussion of your supply chain needs.

 

Blog: What’s in it for me?

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As Business Development Manager at IDS, I get to talk to quite a few people. In fact, I find myself discussing topics such as 4PL, control towers and the impact of the impending Brexit with countless IT managers, logistics managers, finance managers and other professionals in the logistics sector pretty much every day. One thing that strikes me is that, irrespective of whether transport managers are working in the manufacturing, chemicals or agricultural industry, their challenges are almost identical – and the same holds true for customer service managers and other disciplines. Furthermore, there is often a certain amount of discord between them and their colleagues in other departments, despite them all sharing the same end goals: more efficiency and greater customer satisfaction.  

 

Needless to say, for supply chain specialists it’s ultimately about running as a well-oiled machine in which all the individual components work together in perfect harmony. So why is there still so much friction in that machine? The answer is largely due to human nature. Whenever anything changes, people tend to think of the consequences for themselves rather than the bigger picture – and in logistics, things are changing all the time...  

 

 

Therefore, whenever I’m talking to any of these professionals, I put myself in their shoes and start by asking myself the question: What’s in it for me? Over the coming months, I will be peeling back the organizational layers in a series of blogs to reveal what a smooth-running supply chain really means for logistics managers, IT managers, finance managers, customer service managers and transport managers. Which challenges do the various disciplines face? How does one decision impact on another? I will be drawing parallels, explaining how things work in practice and – above all – highlighting common ground as the basis for making improvements together.  

 

Because one thing’s for sure: no matter what role you play within the supply chain, you’re definitely not alone in facing challenges – and who knows, perhaps we can even collaborate to find the optimal solution for your supply chain. I’ll tell you more next month, but for now I wish you a great start to the summer! 

 

Innovation: a big bang or modest improvements every day?

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Friction is something we all come up against in the logistics sector, but no one seems to have discovered the magic formula for dealing with it – and nor will they, because there is no one-size-fits-all remedy for eliminating friction. Innovation occurs in small steps or, as Cora van Nieuwenhuizen, Dutch minister of Infrastructure and Water Management, says:“The ‘Easy Solution Department’ has closed”. Unquestionably, there is plenty of room for improvement in the logistics sector. IDS is putting a number of small-scale innovations into practice that can create a world of difference.

 

Temperature-sensitive shipments

If, in their drive to improve efficiency, all companies implement just-in-time (JIT) delivery aimed at getting goods in the right place at the right time, it can result in planning bottlenecks and conflicts of interest. Such friction has an especially big impact in the case of JIT deliveries of temperature-sensitive shipments. At IDS, in partnership with selected carriers, we are therefore using devices fitted with temperature sensors to monitor what happens to such those in transit. This gives us greater insight into changes in the temperature along the way and the associated effects on the product quality. We then use the resulting data to further optimize subsequent temperature-sensitive shipments.

 

Track and trace

Talking of data, the automatic integration of the data from the carriers’ on-board computers into our transport management system (TMS) enhances the tracking and tracing of shipments. This significantly improves the transparency of all freight movements.

 

Transport forecasting

As a 4PL partner, IDS coordinates the entire transport chain. The more data we have, the better we can prevent friction. That’s why at IDS we are working on solutions for not only temperature-sensitive shipments and track & trace, but also for transport forecasting. By continuously analysing the data from multiple shippers, carriers and warehouses, we can gain insight into which capacity will be required and immediately reserve it with the relevant carriers. This is one way in which we are constantly fine-tuning our data models to further improve the reliability of forecasting the transport needs.

 

e-CMR innovation

When looking to prevent friction and improve supply chain efficiency, it can be easy to forget the administrative aspect. In the world of international transport, it is not unusual to have to wait two weeks for a signed waybill. That’s why at IDS we are innovating with the digital waybill (e-CMR) which is processed directly in the transport management system. Faster invoicing, automatically up-to-date administrative records and far fewer errors. These are just some of the ways that a modest innovation can make a big difference.

 

If you would like to know more about these and other new developments, contact Arno Spoek via arno.spoek@idsnl.com.

Brexit: how to stay on your feet in the gathering storm

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Various recent developments have increased the uncertainty within our sector: Brexit, higher wages, trade wars and new entrants such as Uber Freight that are keen to gain a foothold in the transport sector in the Netherlands and beyond. There seem to be more and more clouds on the horizon. Although Brexit has been postponed until after the summer, you want to be optimally prepared for the gathering storm. Is there reason for concern and, if so, what is the best way to deal with these developments? The answer is to take control of the supply chain rather than leaving yourself at the mercy of all the external forces.

Loss of trust

Many recent regulatory developments within the EU are changing the way the sector works, sometimes for the worse. Besides the impending Brexit, the cabotage regulations are being tightened up and there are changes to the rules relating to rest periods for drivers in secure parking areas. These developments will further intensify the shortage of drivers in Europe. The plans of the American company Uber Freight to expand into the Netherlands and beyond have also sent ripples through the industry. Uber Freight’s app service makes it possible for truck drivers and clients to connect directly. These developments will not only contribute to the worsening driver shortage, but will most likely also disrupt the entire market by creating a ‘race to the bottom’. The solution in this case is better cooperation, but cooperation requires trust. And although revenue growth was stable last year, it comes as no real surprise that exporting companies are less positive about the future outlook than they were a year ago.

How can you retain control?

As mentioned in our previous article, horizontal supply chain collaboration not only generates savings but also enables companies to jointly reduce carbon emissions. But how can supply chain collaboration be improved without a foundation of trust? The solution is to take active control of the collaborative partnership rather than remaining passive, and that’s exactly where a control tower adds value. Logistics managers can take control of their own supply chain while also further shaping their logistics framework by analysing data, hiring specialized transport partners and applying strict quality controls. Armed with professional insights into the inventory, planning, warehouse management and available carriers, they are in a much stronger position to adapt to the changes in the sector.

Make a difference in the run-up to Brexit

It was recently announced that Brexit has been postponed until 31 October to prevent the potential chaos of a ‘no-deal Brexit’. That date is now fixed, unless Prime Minister May gets the divorce agreement ratified earlier. This postponement gives our sector more time to make the necessary preparations and to develop collaborative partnerships. Much will still depend on the type of deal eventually reached between the UK and the EU, which makes it all the more important to have a good understanding of your freight requirements and all the possible scenarios. Irrespective of the particular scenario, each one will undoubtedly require flexibility and thorough preparation. In our IDS control tower, we already have scenarios in place for a large number of our customers and these will be deployed as soon as there is more clarity. You too can benefit from these scenarios and the insights we have gained from developing them.

To find out how, please contact Arno Spoek.

Ps. We have written about Brexit before. Feel free to re-read our previous articles: No-deal Brexit is a big deal for logistics and Brexit: All or nothing!

Control towers: how to train the supply chain dragon

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What with challenges like last-mile issues, emissions regulations and the chance of a Brexit, the supply chain can seem very similar to a multi-headed dragon. But how can it be trained? A control tower appears to offer the answer to this increasingly urgent question. A structured approach to monitoring and managing the supply chain from a single hub: it sounds almost too good to be true – and it often is, because the path to setting up an effective control tower is littered with pitfalls. This article outlines the advantages of control towers and provides tips for avoiding the pitfalls.

 Significant benefits and cost savings

A control tower creates more visibility, more control and a much smoother-running logistics process, in both the long term and the short term. The control tower gathers data from various sources and applies detailed ‘business rules’ to turn it into information as the basis for decision-making. That results in significant benefits and cost savings, including in terms of:

  • End-to-end supply chain visibility
  • Planning, optimization and real-time monitoring of shipments
  • Predictive analysis to identify problems early
  • Streamlined communication between all stakeholders
  • Improved inventory management
  • Simplified freight handling

In other words, a control tower gives supply chain professionals insight into inventory, transport planning, warehouse management and workforce planning. They receive information that helps them to not only make strategic decisions, but also to reduce the number of trips, choose alternative routes, manage stocks, estimate risks or spot potential bottlenecks before they occur.

Weakest link

But therein lies the danger. If information is being exchanged in the whole supply chain, the chain is only as strong as its weakest link. That weakness can manifest itself in various ways. Carriers that have not yet undergone the digital transformation or that do not have a sound technical strategy pose a risk for the integrity of the data used in the control tower for decision-making purposes. Besides that, many supply chain management systems are focused only on optimizing the goods flows within the organization’s own four walls. Once the organization opens its doors (both figuratively and literally speaking) to a control tower, that creates problems with compatibility or metadata. In that case, end-to-end supply chain visibility actually means insight into just a small part of the chain. Furthermore, although it is nice to be able to identify potential problems in advance, what happens next? A control tower that merely issues alerts has limited added value in the logistics process. To be truly effective, it must also enable managers to take action – not only by making manual changes, but also by suggesting possible solutions. This is only possible if the control tower is able to learn from the past and can act autonomously based on strict business rules. Last but not least, a control tower that relies too heavily on specific carriers, warehouses or shippers can prevent the customer from discovering the most efficient logistics solution.

So how can you avoid the pitfalls?

The ideal control tower is a broad ecosystem based on transparency, continuous improvements and extremely solid generic data. To achieve this, it is above all important to make the right choices at the right time. Choices that are not only focused on operational processes, but that also demand tactical and strategic decisions. At IDS we know from experience that the key factors for successful control towers are scope, speed and patience. Start small, achieve results and don’t scale up until the control tower has proven its worth. We help our customers by providing independent control towers that are precisely aligned with their specific supply chain needs, at a pace that suits them. In fact, we sometimes even advise our customers to take things a little more slowly. We do this so that they can gather enough speed to subsequently train the dragon.

We will be joining Buck Consultants International (BCI) during the IMCC College Tour on the 28th of March. Here we will discuss these success factors in more detail. Would you like to attend? Sign up now by sending an email to: jeannet.kornelis@bciglobal.com.

Digital transformation for small carriers: one step at a time

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For many small transport carriers, the idea of extensively digitalizing their processes can seem like a huge step. The big logistics service providers have often already made substantial progress in this area, resulting in an ever-widening gap between the small carriers and their large-scale competitors. With their flexibility and expertise, the small and specialized carriers are an indispensable part of the transport sector. But how can they keep pace with the changing market?

digitalization logistics processes

High-risk operation

According to research by the German agency Herzig Marketing, 54% of small companies (with max. ten employees) have not yet implemented any digitalization projects. In comparison, that figure is just 8% for large companies (with more than 100 employees). The majority of the companies that are not yet executing digitalization projects indicate that they do not consider it to be necessary. Mainly because of the high costs involved and the high risk of failure. In this era of rapid technological advancement and artificial intelligence, however, the small and specialized carriers cannot afford to fall behind in the digital transformation.

IDS relieves the burden

At IDS, as a 4PL service provider, we are used to relieving the burden on our customers when it comes to logistics processes. Small carriers are very valuable for our customers; they reduce our clients’ reliance on the big carriers and have the flexibility to cope with unexpected situations or peaks in demand. If small carriers are not yet in a position to digitalize their own processes, our solutions such as the IDS Dashboard ensure that the end-to-end provision of information throughout the supply chain runs smoothly. Hence, our 4PL solutions enable customers to benefit from the flexibility and expertise of all relevant carriers – even the smaller ones.

Besides that, at IDS we can help small carriers to take their first steps towards digitalization by offering them solutions for aspects such as tracking & tracing, delivery-time prediction and digital proof of delivery. As a result, IDS helps small, motivated carriers who provide an excellent service to keep pace with current and future digitalization requirements.

To find out more about how IDS could help your organization in this context, feel free to contact our Business Development Manager, Arno Spoek.

Rate changes in 2019: what to expect?

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The start of a new year is always accompanied by new developments, and it is traditionally the time when any rate changes come into effect. It is important for companies in the transport and logistics sector to be aware of such changes, which is why in this article we outline what rate changes to expect in 2019.

Facts and figures

Research firm Panteia/NEA investigated how tariffs will change in the transport sector in the coming year and came up with the following findings:

  • In 2019, the labour costs for drivers in the Netherlands are expected to increase by 6.73%. This percentage is made up of the pay rise stipulated in the collective labour agreement, the addition of an extra increment to the salary scale, changes in taxes and social security contributions and an adjustment to the compensation for bonuses and overtime. Moreover, the continued shortage of drivers is also leading to higher labour costs.
  • Insurance premiums (third-party and comprehensive) are expected to rise by 8.4% compared with 2018.
  • For other general costs, Panteia sticks to the general price increase which is quantified at 2.4%.
  • The German toll (Maut) will rise on 1 January 2019, which will result in a substantial increase of the kilometre charge – which was previously extended on 1 July this year. The extra costs in Switzerland, the Czech Republic, Slovakia and Poland will also increase by a few percent of the cargo price, depending on the route.
  • The average diesel price in the Netherlands for the whole of 2018 will be around 10% higher than the average for 2017, and in France that percentage will be as high as 17%. Dutch bank ABN Amro expects the oil price to rise further in 2019, by as much as 9%. The French government was planning to raise environmental tax as of 1 January but, after weeks of protest by the Yellow Vest movement, President Macron has now decided to completely remove the ecotax hike from the country’s budget in order to prevent the unrest from escalating further.

Rate increases drive supply chain collaboration

Based on these figures, transport and logistics activities are expected to become significantly more expensive. How can you stay profitable in the face of rising costs?

Over the past year at IDS, we have been exploring ways in which our customers can benefit from supply chain collaboration. Our research revealed the potential for a 14% cost reduction for all shippers if we could achieve full horizontal collaboration. In other words, supply chain collaboration now makes more sense than ever for shippers, not only in terms of huge cost savings but also in the context of reducing kilometres and CO2. Meanwhile, in the context of Brexit, supply chain collaboration for shipments to and from the UK can offer benefits and reduce the risks of disruptions to supply.

Arno Spoek, Business Development Manager at IDS, comments: “Our Control Tower gives us insight into the dynamic relationships between shippers and end customers. This has revealed that a shared problem forms the basis for successful supply chain collaboration. There needs to be a clear business case supported by all sides, and they then have to jointly develop an implementation strategy to turn their collaboration into reality. At IDS we’re currently developing business cases per shipper and per chain so that we can provide our customers with details of the concrete benefits of supply chain collaboration. We will then reach agreements with the shippers and partners in the vertical supply chain to actually make it happen.”

Keen to know more about supply chain collaboration? Listen to the second Logistics & Innovation podcast to hear IDS Business Development Manager Arno Spoek and other specialists explain more, or contact Arno directly: arno.spoek@idsnl.com or +31 (0) 88 437 4370.

 

Brexit: all or nothing!

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We covered the topic of Brexit back in August, but it’s an ongoing concern for businesses throughout Europe. A draft Brexit deal is now finally on the table, but companies on the mainland can’t breathe a sigh of relief just yet.

 

 

Provisional agreement

The provisional agreement stipulates that the UK’s membership of the customs union will be extended if no deal has been reached on a new trade relationship with the EU countries by the end of the transition period. This will avoid having to establish a ‘hard’ border with physical border checks. As a result, there will be minimum disruption to post-Brexit trade. But the draft deal is no guarantee; it still has to be approved by both the European Parliament and the British parliament.

 

Worst-case scenario: no deal

Although the provisional agreement sounds promising, in reality anything could still happen. It is a matter of all or nothing. In the ideal case, the industry will hardly notice any changes. In the worst-case scenario, your import and export activities will grind to a halt.

 

Be prepared

Last time, we gave you some tips to help you prepare for the potential post-Brexit chaos. Nanette van Schelven, Managing Director of the Dutch Customs Administration, also warned logistics transport companies to register with the customs authorities in good time. According to Van Schelven, as a result of the Brexit, 35,000 companies will have to deal with the customs office for the first time ever in order to continue exporting to or importing from the EU. If these companies wait until the last minute to register, the Customs Office cannot guarantee that they will all be dealt with in time.

 

Because so many aspects are still uncertain, many businesses are unsure of which preparations they need to make. That’s why at IDS we’re helping our customers to gain insight into all their freight flows, in order to evaluate the potential Brexit-related risks. We analyse various scenarios based on the possible outcomes of the current negotiations. As soon as the real implications of Brexit become clear, we will already have the most suitable solution lined up and ready for rapid implementation.

 

If you would like to know more about our Brexit-related services, contact Arno Spoek at IDS on arno.spoek@idsnl.com or +31 (0) 88 437 4370.