A perfect storm for European distribution

January 20, 2021 // By Nick Flaherty
A perfect storm for European distribution
Nick Flaherty talks to Pete Malpas and Andy Keenan at RS Components about the challenges of Covid-19 and Brexit

The last year has been challenging for the distribution industry across Europe keeping supplies flowing during with the Covid-19 pandemic. The last few weeks have added on Brexit with the UK leaving the EU and lorries held up at Dover and Calais.  

“We are very focussed on the front end design and not so caught up in the production quantities,” said Pete Malpas, vice president for the EMEA region (above) who was previously head of northern Europe. “We have a product situation that is very broad but relatively quite shallow. We don’t get into the mass production so we are managing our supply chain.”

This means the UK leaving the EU has a similar impact to Covid-19.

“We have made decisions more than twice to prepare for Brexit,” said Malpas. “There’s a lot going on at the moment. For example, [global logistics company] DB Schenker suspended deliveries into the UK with implications for automotive shipments.”

Those decisions involved increasing stock levels in multiple distribution warehouses.

“Like many companies we prepared several times for Brexit. We are in a fortunate position where we have multiple stocking locations around the world, and we made the decision early to increase our inventory with around £27m across EMEA,” he said. “We never really took that out, and having that additional inventory really helped. As we headed to the end of the year we put additional inventory in again in multiple locations to help mitigate against any eventuality.

“We’ve had a cross function team working on this for several years and we breathed  sigh of relief with a deal at the 12th hour. We serve the DACH [German and central European markets] from Bad Hersfeld in Germany and where we have cross border shipments we moved from road to air – there are implications with that but we are seeing no issues at all with that," he said.

Next: Logistics issues for distribution 


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