'Brexit has been considerably worse than expected' says JD Sports chairman Peter Cowgill and could result in the "transfer of a number of jobs into Europe"

Photo: Google, DigitalGlobe

JD Sports Distribution Centre in Rochdale

Chairman of retailer JD Sports, Peter Cowgill, has said that Brexit has been “considerably worse” than initially thought.

Speaking to BBC Radio 4 on Tuesday (9 February), Mr Cowgill said the red tape and delays in shipping goods to mainland Europe meant “double digit millions” in extra costs.

He said: “We ship from our Rochdale distribution centre to all territories in Europe. There was a point in time when parcel deliveries were ceased... so there was a big backlog and the amount of red tape is very significant so it slows the whole process down, it’s more costly.”

Mr Cowgill added that the free trade agreement ‘wasn’t really the case’ – noting if “you source from the Far East, for instance, then bring to the UK and ship to stores, as we have stores in every country in Europe, then the tariffs apply. That pushes you to need to locate a distribution centre in Europe and with it goes the employment to the UK.”

To ease the problems, he said the company may open an EU-based distribution centre – estimated to create 1,000 jobs overseas – which “would make a lot of economic sense.”

While JD Sports' existing warehouse in Rochdale would not close, "it would mean the transfer of a number of jobs into Europe," Mr Cowgill told the World At One radio show.

He added that closing stores “was yet to be seen, depending on when the market levels out.”

He also called for an overhaul of business rates and rents, claiming: “bricks and mortar retailing is becoming uneconomic. It boils down to the pricing.”

Mr Cowgill also criticised government's decision-making on forcing non-essential shops to close, while allowing essential shops to stay open – a move which has allowed supermarkets to sell clothes, while firms like JD Sports had to shut.

He said: "Some essential retailers have been making hay out of selling clothes, whilst clothing retailers have been closed. It is bizarre.”

Responding to the BBC, the Cabinet Office said in a statement: "We know that some businesses are facing challenges with specific aspects of our new trading relationship, and that's why we are operating export helplines, running webinars with experts and offering businesses support via our network of 300 international trade advisers.

“We will ensure businesses get the support they need to trade effectively with Europe and to seize new opportunities as we strike trade deals with the world's fastest growing markets and explore our newfound regulatory freedoms."