Newry export businessman considering relocating to the Republic
A NEWRY businessman is weighing up relocating south of the border as Theresa May prepares to trigger Article 50 today.
The move marks the beginning of the formal exit process and starts the clock on negotiations over leaving.
Paul Vallely, who runs online rug retailer Kukoon.com from Newry, said market uncertainty and potential trade tariffs made it impossible to plan ahead.
He is considering moving the business, formerly known as The Rug House, and its 27 staff, to Dundalk, Co Louth.
The town is just 13 miles south of Newry, but businesses there have unfettered access to the EU’s single market.
Earlier this year, Craigavon-based pharma firm Almac announced it was opening premises in the town to guarantee access to the EU market.
Mr Vallely, who runs Kukoon. com with his sister, Clare, said: “We’ve talked with staff about the possibility of moving to Dun- dalk. For some of them it’s not an issue, but some others who do quite specialised roles are already traveling from Lisburn and Belfast, so it’s something we are still weighing up.
“At the moment, export businesses like mine are only able to plan ahead on a three to sixmonth basis, and that’s no way to run any business.
“At least in the Republic there’s a state of play and things will stay the same.”
Exports account for around half of the company’s sales, with just 4% of orders made in Northern Ireland and the Republic of Ireland.
The majority are shipped to the USA, with customers in Germany, Italy and Spain the next biggest chunk.
Despite cheap manufacturing costs in Asia, Mr Vallely said his business’s biggest competition came from sellers in Germany. He also explained he expected consumers would begin to see shopshelf prices increasing around two years and three months from today.
“By this point, it’s likely that any stockpiles built up before the exit to avoid import tariffs will start to run out and retailers will have to up their prices,” Mr Vallely added.
“We import most of our goods from Belgium, Turkey and India, so that will mean that we will have to pay tariffs to import.
“I’d expect they could be as much as 15 to 25%, and that’s another barrier for our business.
“Our margins are very small, so while it’s a very competitive industry, the only way I can see it working is to add it to prices.
“I’d expect that, across the board, retailers could have to add as much as 10% on to the price of imported goods.”
This month an agent for CityNorth Business Park in the north of Dublin said he had been “inundated” with enquiries from Northern Ireland companies looking to establish a presence in the Republic.