Hub Europe and Hermes set up home delivery service to help Jersey retailers exploit LVCR.
|November 25, 2010||Posted by lvcradmin under VAT|
Fulfilment company HubEurope – recently awarded a licence by the Jersey competition Regulatory Authority for the provision of postal services to the island and the fulfilment sector – has joined up with with parcel delivery Hermes to create what they describe as “the first alternative home delivery service for Jersey-based fulfilment houses and retailers looking to ship products to the UK” Apparantly the company will use Hermes’ position as the leading UK courier network to “compete with postal operator Jersey Post for 60 million parcels and packets delivered to the UK each year“
An article from Nov 22nd on the web based Delivery Magazine goes on to state that ” The J+2 (Jersey + 2 days) solution will provide a 48-hour, fully tracked service to addresses across the UK, with 94 per cent of all packages delivered first time. HubEurope will target businesses using Jersey for offshore fulfilment that takes advantage of Low Value Consignment Relief privileges, allowing items under £18.00 to be sold to an EU address without the addition of VAT to the price. This will include retailers and fulfilment houses selling a range of low value products such as CDs, DVDs, books and bulbs” The first company to take advantage of this service will be Flying Brands and its mail order Gardening Direct operation. Delivery Magazine goes on to state that “Following an initial four-week trial, more than one million items made up of bulbs and plants will be delivered to the UK each year. Packages will be shipped to Southampton via ferry on a daily basis. From there they will be transported to Hermes’ national hub in Nuneaton for onward delivery to the company’s regional depot network and more than 7,500 lifestyle couriers”
Carole Woodhead, CEO of Hermes in the UK said: “We are continually looking for like-minded companies such as HubEurope to develop partnership opportunities that will ultimately provide value to high street, catalogue and Internet retailers. By teaming up with HubEurope, retailers and fulfilment houses based in Jersey can now take advantage of our courier network, which combines a quality doorstep delivery, with a friendly and local approach.”
This arrangement might not appear so friendly or valuable to UK internet and high street VAT paying businesses who are struggling to survive under an avalanche of products that are flagrantly exploiting LVCR and gaining an unfair competitive advantage through the avoidance of VAT.