The UK economy relies heavily on uninterrupted flow of goods and services. However, unless businesses in specific sectors work with a well-positioned international immigration lawyer, visa delays will keep causing supply chain issues for them.
These visa delays cause compliance challenges for businesses, labour shortages, shipment disruptions, increased costs, hinder production, and affect the availability of goods and services which in turn impacts supply chains in specific sectors.
This article will help readers understand how visa delays cause disruptions in the supply chain, the risks attached to these disruptions and strategies that can be adopted to mitigate them.
Readers will also understand why visa approvals for certain personnel are important for the smooth movement of goods and services.
The Interconnectedness of Visas and Supply
Sourcing goods and services on a global scale gives UK consumers access to more diverse products, new markets and reduced prices. However, sourcing them comes with the responsibilities of handling supplier relationships, logistics, and regulatory compliance.
International procurement means the process of sourcing, ordering, receiving and managing goods and services from suppliers located in different countries. To successfully procure them, business owners need to go through logistical challenges, legal frameworks and international trade.
Currently, the UK government tackles the dilemma between facilitating the cross-border flow of goods and services to improve the political and economic state of the country and controlling that same flow for health and safety reasons, immigration control and security reasons.
Visas are important to global entrepreneurs so that they can visit production sites, perform quality control checks, negotiate with suppliers and oversee logistics. Hence, where there are delays in vital supply chain stages, it can cause a business to haemorrhage money.
Other effects it can have on the business include customer dissatisfaction, missed opportunities, slowing/halting production and increased costs. The industries that take the most hit from these disruptions include oil and gas, construction, electronics manufacturing, food production and distribution, pharmaceuticals, agriculture and technology.
The most vulnerable of them are those that belong to the ‘Just-in-time (JIT)’ supply chain. That means those businesses or companies that order materials and goods only when they need them.
The idea behind the JIT supply chain is to minimize waste, improve efficiency, and reduce inventory costs but what happens when there’s a delay in receiving said raw goods and materials at the time when it is needed.
Specific Disruptions Caused by Visa Delays
Visa delays cause specific disruptions to the supply chain; some of which will be discussed below:
- Production delays
- Logistics Bottlenecks
- Supplier Relationship Management
- Contractual Obligations
- Financial Losses
Production delays
Certain industries require factory visits, supervision and troubleshooting by key stakeholders of the business or company during the production stage. The aim is to ensure that exactly what is ordered is what is being produced.
Also, for industries in food and health, the products produced are produced in a safe environment and do not contain harmful substances that can hurt consumers.
Other times, it could be that the raw materials needed for production have to be imported, hence, visa delays will affect production schedules and delivery timelines.
Logistics Bottlenecks
Another supply chain affected by visa delay is logistics which can manifest in customs clearance, transportation, and coordinating shipping.
If there are delays in visa approvals, the goods will have to be stored for longer periods than was intended which will incur higher costs for the company. Also, if the customers get impatient or the goods are damaged, they will ask for a refund which will lead to reputational damage and financial loss.
Supplier Relationship Management
There are businesses that require on-site approval by external auditors especially during production and packaging stages. So, if the auditor cannot enter the destination country of the auditee due to visa delay, it can slow down production.
There are companies that prefer to evaluate suppliers physically to ensure that they meet the required standards for cost-effectiveness, quality and reliability before going into business with them. However, visa delays can ruin the planned supplier evaluations.
Contractual Obligations
In business operations, contracts are usually entered into with penalties attached for whoever fails to fulfil their part. Hence, where visa delays cause a party to the contract to miss deadlines and fail to fulfil contractual agreements, it can result in legal disputes and financial penalties.
Financial Losses
Every disruption in the supply chain causes some form of financial loss whether it is damage to goods, storage issues and legal disputes. Overall, the direct and indirect costs of acquiring the goods and services can become more expensive than the original cost needed to acquire them in the first place.
Strategies and Solutions on How to Mitigating Visa Delay Risks
Visa delays may not be stopped entirely but they can be mitigated through the following steps:
Proactive planning and early applications – When running an international business, you need to anticipate that there will be delays in visa processing times and have contingency plans for when it happens.
Diversifying supplier networks – If you keep experiencing difficulties in sourcing products or services from suppliers in high-risk regions, then you may want to consider alternative sourcing locations.
Leveraging technology – If it can be an email or a virtual meeting, then companies do not need to take the extra step of applying for visas to travel. They can opt for remote audits and hire remote workers to handle tasks that can be done with technology.
Building strong relationships with Embassies and Consulates – Since embassies and consulates are responsible for visa approvals, companies should work towards building a strong business relationship with them.
One sure way to achieve that is to establish a clear and consistent communication channel and have a transparent record. Companies should learn to ask consulates for guidance on the right visas to apply for and how to apply for them.
Working with experienced logistics and freight forwarding partners – Experienced logistic companies will have encountered the problem of visa delays while handling prior orders and will have figured out a way to work around them.
So, it is advisable to use them especially if you need priority delivery of your goods and services.
Legal counsel – Any company that has enough resources to import and export goods and services should take certain legal precautions like having a legal team who are experienced in immigration and international trade on retainer.
Conclusion
Geopolitical events and the ever-changing immigration policies can affect a business’s smooth flow of goods and services.
For instance, before Brexit, Europeans could easily come to Britain and sell their goods and services without a visa. However, they now need to obtain visas before they can work or establish a business in the UK.
Another example is that a country’s geopolitics can affect the way other countries grant them visas. For instance, immigration policies can have a negative impact on some developing countries which can affect visa approval rates.
Looking at the above challenges, companies should be willing to adopt technological alternatives for certain tasks to be able to mitigate and manage these supply chain issues.
Regardless, of how strict companies are with their visa processing and approval, international trade will still be needed for economic growth. Instead of giving up, companies should apply the strategies and solutions suggested in this article and stay resilient if they want to experience business success.
