Brexit could see drinks manufacturing move abroad
Fentimans, named the number one soft drinks brand in The Guild of Fine Food’s Best Brands Survey, have announced that if the UK fails to negotiate a tariff-free trade deal with the EU the company will consider setting up a manufacturing plant in Europe. Could other companies follow them across the channel?
Theresa May has set the 29th March as the date on when article 50 will be invoked, and a free trade promise with the EU is looking unlikely at present. Interestingly, the owner of Fentimans, Eldon Robson, voted to leave the EU in the referendum stating that it will ‘provide more opportunities for the brand’. Fentimans currently exports to 65 countries with the look to increase that by another 15.
Since the referendum, UK inflation has peaked at 2.3%, the highest rate in three and a half years, and the devaluation of the pound is cause for concern reagarding the future price of goods, with food and fuel prices the first to be affected. With inflation set to reach 3% by the end of the year, way over the government’s 2% target.
Over the past few months many companies have warned of struggles ahead.Premier Foods warned in January that it was introducing a cost cutting programme to battle sluggish sales and Easyjet saw a fall in sales as higher holiday costs led to more Britons staying at home.
Industries relying on imports, such as food and drinks, are already seeing costs rise as imports and exports become more costly and uncertainty over a potential trade deal is adding to the increased contingency planning by businesses that could see them move their business on to the continent.