Trade and inventory

Manufacturers can maximise CPTPP sales opportunity with a Warehouse Management System

Here's how a Warehouse Management System (WMS) will enable UK manufacturers to maximise their Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) export opportunities.

In mid-December 2024 the UK officially joined the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and in doing so, became the first European member of this trade bloc of 12 countries. Current members comprise a dynamic mix of developed and emerging economies including: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and now, the UK.

 

It is a very significant trade development because the bloc represents approximately 15% of global GDP, trading across a market reaching 500 million plus people. After the economic fallout from Brexit and the Covid pandemic, this presents many new business opportunities, but it will also create new challenges for logistics managers operating in the UK and across the CPTPP region. The new agreement will clearly increase trade levels and should be a wakeup call for UK companies to invest in the right warehouse automation and re-engineer warehouse processes, if they have not already.

 

How will the CPTPP benefit UK manufacturers?

The CPTPP offers many critical benefits for logistics managers, with the potential for tariff reductions being the most obvious and immediate. Over 99% of UK goods being exported to CPTPP countries will be eligible for zero tariffs. And when goods are traded between member countries, this will eliminate 95% of tariffs. With trading tariffs reduced, UK manufacturers could see rapidly increased trade volumes and new opportunities for cross-border shipments.

 

In addition to the advantageous trading tariffs, the CPTPP introduces more flexible rules of origin. This will be particularly beneficial for the complex supply chains typical among manufacturers in the UK. Specifically, manufacturers within the bloc will be able to claim preferential treatment if 70% of their product components come from participating countries. And any products sourced from multiple CPTPP countries can qualify for low or zero tariff treatment when exported within the bloc. For logistics managers, this creates the challenge of potentially needing to manage far more intricate supply chains spanning multiple CPTPP countries.

 

Additional sector-specific opportunities

Some industry sectors will most likely see greater growth of export sales. For instance, the UK’s motor vehicle exports to CPTPP countries are projected to increase by £712 million according to reports in The Manufacturer magazine. Pharma is another big export sale for the UK and likely to benefit from the reduced costs and expanded supply chains resulting from the trade agreement, along with large machinery exports.

 

All these opportunities highlight the urgency for logistics managers to scale their operations to be able to cope with the increased demand and trade. One of the most efficient ways to prepare is by investing in a warehouse management system (WMS).

5 ways a WMS helps maximise opportunity from CPTPP

Here’s how a WMS will enable UK manufacturers to maximise their CPTPP export opportunities:

 

Improved stock visibility and control

 

A best of breed WMS provides real-time inventory visibility, which is essential for managing the extra flow of goods expected from CPTPP trade. This level of visibility allows warehouses to:

 

  • Precisely track all products originating from CPTPP member countries;
  • Manage inventory levels highly efficiently to satisfy new demand patterns;
  • Ensure compliance with the CPTPP rules of origin requirements.

 

Improved warehouse space utilisation

 

These days, warehouse space is always at a premium with property and rental prices being at an all time high. The potential increases to trade volumes will increase pressure on warehouses to maximise their storage capacity and this is easily achieved with the introduction of a WMS. Once implemented a WMS will automatically optimise putaways and space allocation, based on incoming and outgoing shipments. Very significantly, a WMS will also enable up to 30% more stock to be stored in a given area, which is critical for coping with projected increased trade volumes. For regulated industries requiring special storage and handling requirements, these instructions can be programmed into the WMS and automatically adhered to.

 

Streamlined customs compliance

 

Becoming part of the CPTPP brings additional new compliance requirements for UK manufacturers and a WMS helps warehouses by removing time consuming administration tasks. For instance, this includes being able to automate the tracking of product origins to ensure compliance with CPTPP’s 70% rule for preferential treatment. In addition, it will automatically generate the documentation needed for customs clearance, reducing delays and potential late shipment penalties.

 

Improved supply chain integration

 

Participating in the CPTPP will result in greater diversification of supply chains across its member countries. Without a WMS this would be highly complex to manage, but a WMS makes light work of this complexity. Best of breed WMS solutions can integrate with transport management systems (TMS) to optimise inbound and outbound logistics operations. In addition, supply chain visibility and planning capabilities are enhanced by providing valuable data that can be shared with ERP systems to improving the overall customer experience. A WMS also provides analytics on warehouse performance, helping managers adapt to new trading patterns and inventory models.

 

Faster stock picking and packing rates

 

As trade with CPTPP countries ramps up, it will be critical to have highly efficient order fulfilment capabilities. A WMS will enable this by optimised picking strategies (including zone, batch, or wave picking models) to handle the increased order volumes. As documentation can be generated automatically, advanced shipping notification (ASN) reports can be generated automatically, improving customer relations and meeting CPTPP market expectations.

 

Becoming part of the CPTPP is a fantastic opportunity for UK manufacturers. By implementing a best of breed WMS, warehouses will have the resources to navigate any new challenges and capitalise fully on the export sales increases available.

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