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Brexit sparks race for warehouse space in Britain

Video Credit: Reuters Studio - Duration: 01:45s - Published < > Embed
Brexit sparks race for warehouse space in Britain

Brexit sparks race for warehouse space in Britain

As the prospect of a no-deal Brexit looms, some companies in the UK have started stockpiling goods ahead of Britain leaving the EU in March 2019.

The world's fifth-largest economy risks stumbling into a disorderly exit from its biggest trading partner, the European Union, if parliament votes down Prime Minister Theresa May's withdrawal agreement on December 11.

Saskia O'Donoghue reports

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Brexit sparks race for warehouse space in Britain

The race for British warehouse space is on.

As the prospect of a no-deal Brexit looms on the horizon, some UK companies are stockpiling goods in the event of a disorderly departure from the European Union.

Narrowing aisles.

Mezzanine floors.

Temporary structures.

And racks removed for floor-to-ceiling pile-ups.

Owners of frozen and chilled storage space say they're fully booked until the middle of next year.

And the government has asked for more secure storage for medication to be built.

Companies typically want space for about six to 12 months -- much less than the normal five-year contracts.

The EU is Britain's biggest trading partner.

And there are serious fears that a disorderly Brexit would lead to border checks, blocked ports and major tailbacks on the roads, threatening the $540 billion worth of goods that move back and forth.

Companies from Rolls-Royce and Airbus, retailers and manufacturers have all said they are building up stock ahead of Brexit on March 29.

And it's affecting small businesses too.

(SOUNDBITE) (English) FOUNDER OF THE GROWN UP CHOCOLATE COMPANY, JAMES ECCLESTONE, SAYING: "So, a no deal scenario really scares me.

I mean chocolate can't stop - it's got to keep moving the whole time.

Regulations are strictly enforced, we're no longer part of the club and goods can get rejected perhaps more easily." But, for now, stockpiling is the order of the day.

Robert Hardy's firm has seen a lot of companies get in touch in preparation for an increasingly likely no-deal event.

He says the worry for businesses may be unnecessary.

(SOUNDBITE) (English) OPERATIONS DIRECTOR AT OAKLAND INVICTA, ROBERT HARDY, SAYING: "This is unfamiliar territory to them, so their reaction is not necessarily the right one and stockpiling is rather a panicky kneejerk reaction when there are custom simplifications that can make life easier." Brexit-backers have always accepted that the economy would take an initial hit.

Though they insist that it will benefit from new trade deals in the long run.

But with so much uncertainty, these companies aren't taking any chances.




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