Effective compliance: opening the UK market?

Over the past few decades, China has served as the production hub for businesses across multiple industries, but recent reports suggest this may soon change. 

The frailty of the global supply chain has been highlighted in Covid-19’s devastating world tour – sparking widespread quests for supply chain diversification into alternative markets in recent months.

South Africa has been touted within the automotive and renewables industries as one such alternative market that could potentially flourish as a result of businesses seeking to diversify their production lines. 

Graham Welland – CEO of international business risk and compliance firm GW Consulting International in the United Kingdom (UK) – has advised that South African manufacturers must embrace regulatory compliance if they are to invite lucrative overseas contracts and capitalise on the forecasted mass exodus from China. 

He comments: “A solid compliance model adds legitimacy and credibility to a business and provides potential prospects with the comfort of knowing that the organisation with which they are looking to enter into a commercial agreement is both ethical and law-abiding. 

“In an age where regulatory compliance is becoming a focal requirement for any overseas business deal, investing in compliance is imperative for long-term company success and sustainability. Not only will it protect the company brand, but it can also enhance its longevity and reputation.

“From a trader’s perspective, entering into a commercial agreement with an unknown party who fails to demonstrate key areas of compliance could potentially set off alarm bells, as the sole purpose of instilling a solid compliance function within a business is to safeguard it against any unethical or nefarious links down the supply chain. Without this in place, the trader may take the view that by entering into a commercial agreement with a non-compliant organisation, it could potentially leave itself vulnerable to reputational or financial damages – or perhaps even legal repercussions.” 

South Africa offers a wealth of commercial opportunities, he notes, especially for UK businesses. Its strong manufacturing base offers significantly reduced transit times compared with China, reaching as low as 18 days, and its price competitiveness is reasonable compared to other alternative markets. 

“But, to capitalise on the wave of businesses seeking to diversify their production lines, South African manufacturers should be able to demonstrate key areas of compliance in order to avoid putting themselves at a disadvantage when seeking contracts from the UK, or any overseas business.”