European retailers may have to adapt their supply chains as a result of the Brexit trade deal, requiring extra investments and expenses. According to Fitch Ratings, a provider of credit ratings, commentary and research for global capital markets, supplies to Northern Ireland are also subject to a special protocol, which requires additional certifications and administrative procedures.
The Brexit deal keeps trade in goods between the EU and the UK tariff-free, which is a much better outcome for retailers than a no-deal WTO scenario with tariffs on all trade. However, any re-exports from UK warehouses of goods produced in third countries are subject to tariffs in the EU. Furthermore, new border checks slow down logistics.
Many stores operated by UK retailers in the EU have been experiencing supply shortages since the new deal came into force at the beginning of the year. The most-affected product groups are those with a short shelf life, such as ready meals and some fresh fruit and vegetables.