// JD Sports eyeing a new distribution site in the EU, creating 1000 jobs
// The plans come as JD Sports boss Peter Cowgill says the impact of Brexit was was costing the firm more than £10m
// He says disruption in shipping goods to mainland Europe meant extra costs in the “double digit millions”
The boss of JD Sports has said the impact of Brexit has been “considerably worse” than feared and now plans to open a warehouse in the EU because of the red tape and delays.
JD Sports executive chairman Peter Cowgill said disruption in shipping goods to mainland Europe meant extra costs of more than £10 million.
He told BBC Radio 4’s World At One programme that the retailer was eyeing a new distribution site in mainland Europe to help it side-step tariff costs and disruption.
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JD Sports said that the warehouse, which would employ about 1000 staff, could have been built in the UK but will now be within the EU in light of the Brexit deal.
It is understood that no current jobs at its UK distribution sites will be affected.
New trade rules came into force on January 1 after the UK Government secured a last-minute deal with the EU.
However, Cowgill said the amount of red tape has been “very significant”, slowed down JD Sports’ trade processes, and added to costs.
“They said we have a free-trade arrangement but that’s really not the case,” he said.
“If you source from the Far East and bring products to the UK and then ship to stores, the tariffs apply.
“With the tariffs that apply, it would make a lot of economic sense to have a distribution centre in Europe as well the UK – it would mean the transfer of a number of jobs into Europe.
“It’s considerably worse than predicted.
“The implications of it have probably been appreciated after the event and probably not attracted the airtime and publicity that they otherwise would have done because Covid is more serious at present.”
Cowgill also warned that an overhaul of business rates and rents wee needed for UK retail to recover.
It comes after 18 retail bosses, including chiefs at Tesco, Asda and Morrisons, called on Chancellor Rishi Sunak to reduce rates as part of a shake-up.
“I think the high streets and shopping centres have got to be repriced,” Cowgill said.
“Clearly the accommodation expenses, which have been too high for a long period of time, mean that bricks and mortar stores are uneconomical and unviable.
“I think we have to have another year’s rates holiday to be honest and then there’s got to be a major reassessment of the cost of rates to the retailer if viability and prosperity is to return to shopping centres and high streets.”
with PA Wires