How manufacturers can overcome international expansion red tape

12th October 2021

Rewatch our webinar: Untangling the red tape of international trade

• 93% of manufacturers see opportunity for increased US-UK trade
• However, 87% experience red tape challenges

For both UK and US manufacturers, international expansion offers significant opportunity for growth. Given the cultural similarities, shared language, and access to other markets, expanding in either direction across the Atlantic is often high on the priority list.

For our new report, Made for Trade, we surveyed 200 senior managers at US and UK manufacturing businesses based in the industrial heartlands of the US Midwest and the UK Northern Powerhouse*.

We found that most – 93% – see opportunity for increased US-UK trade, but nearly as many – 87% – experience some form of red tape challenge.

Regulatory barriers

Regulation is a common a barrier for businesses wanting to trade overseas: of the senior managers we surveyed, 87% say they experience challenges in working with foreign legal systems, 80% are hindered by barriers to trade such as tariffs and quotas, and 53% say the volume of regulation in their target market is an issue.

There are many factors at play, from more rigorous environmental standards and data protection rules in response to societal changes, to the re-emergence of protectionism and embargos as a result of political instability. The exact nature of the challenge will vary according to market and business.

As Andrew Northage, Head of International Trade, Walker Morris says: “The regulatory challenges vary from sector to sector and from company to company and so are necessarily wide-ranging. But one recurring question we help to answer is – how can I do this?”

Identify key issues

The answer in nearly every case involves working through the regulation as early as possible. Identify the key legal, regulatory and compliance issues that need to be dealt with at each stage of the supply chain. This is true for manufacturers, distributors, retailers or authorised representatives. Sufficient time will be crucial to overcome any regulatory hurdles and put the right contractual and other protections in place.

Regulatory compliance is generally too complex to automate, so a second core requirement is in-depth knowledge. Make sure your adviser really understands your sector, so you can be confident you know exactly what is required at each stage of the supply chain. This will help you put appropriate compliance procedures in place without taking on more liability that you should.

Join the Walker Morris International Trade Team for our webinar on ‘How do you make a resilient supply chain?’ on 16 November. We will be exploring what happens when issues arise in your supply chain, and how you can prevent them. Find out more here.

*US Midwest is defined as Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Wisconsin.

UK Northern Powerhouse is defined as the city regions of Hull, Leeds, Liverpool, Manchester, Sheffield.