Encompassing over 1,000 firms, the research study revealed that 55% of UK exporters are experiencing the reverberations of the shipping disruptions in the Red Sea and, so too 53% of manufacturers and business-to-consumer (B2C) service firms, including retailers. Not surprisingly, key impacts reported include increased costs and delays.

The study highlighted soaring costs for businesses, with some reporting a surge of up to 300% in container hire expenses. Logistical delays, extending delivery times by three to four weeks, were also flagged as a significant challenge. In turn, the disruptions have triggered effects throughout the supply chain, such as cashflow difficulties and shortages of components on production lines.

William Bain, Head of Trade Policy at the BCC, said: “There has been spare capacity in the shipping freight industry to respond to the difficulties, which has bought us some time. And recent ONS data also indicates the impact has yet to filter through to the UK economy, with inflation holding steady in January. But our research suggests that the longer the current situation persists, the more likely it is that the cost pressures will start to build.”

According to Bain, the situation is further exacerbated by the recent introduction of the new customs checks and procedures for imports by the UK government which are also adding to costs and delays.

“The UK economy saw a drop in its total good exports for 2023, and with global demand weak, there is a need for the Government to look at providing support in the March Budget. Overseas trade is vital to growing our economy. We must do everything we can to see businesses through these tough times, and then set a laser-sharp focus on expanding exports for the future,” he added.