The danger with ongoing political stories – regardless of how much they affect you personally – is that there can come a point where you start to switch off from the headlines and rhetoric.
Usually, because there’s nothing much new to say.
Brexit, for me, is one of those stories.
Just after the referendum result, I was eagerly seeking out news about how this would affect me and my business. The lack of a clear direction since then has made it very difficult for business owners to plan.
The recent General Election has clarified things a little. Prime Minister Boris Johnson campaigned with the message to ‘Get Brexit Done’. The Conservatives winning a large majority means Brexit is indeed getting done, in one way or another. Now there is something new to say! But the uncertainty and instability hasn’t gone away entirely.
With the UK formally leaving the EU on 31 January 2020, we’re still unclear on the future trading relationship…
- Will there be free trade between the EU and UK as before?
- If not, what will the relationship be?
- What extra costs and delays might that mean?
- How might this affect my supply chain?
- What about trade with non-EU countries?
The transition period means businesses have until at least the end of 2020 to consider these questions and the different scenarios that are likely.
I’ve put together my SWOT analysis of the situation for a small business owner. This is less about the economic data on Brexit and more about the way in which small businesses can react to instability and uncertainty.
- Small businesses are more easily adaptable. We’ve less infrastructure and reliance on systems than large corporations and can be agile and fast in response to change.
- Entrepreneurial spirit seeks opportunities. There are always winners and losers in economic uncertainty and downtimes… entrepreneurs are notorious for maximising the opportunities and have a keen nose for sniffing them out.
- We’re a ‘keep calm and carry on’ nation. And whilst it may be cliché, we Brits do get on with things and pull together in times of need. I suspect the business community will pull together even more to share knowledge and resource.
- Uncertainty makes it hard to make decisions. It’s even more important for you as the business owner to weigh up the risks of any business decisions. Whilst there are many opportunities, there are few guarantees and fortune doesn’t always favour the brave.
- Your staff may be affected. Especially if you hire EU citizens who, come the end of negotiations, may leave the UK, leaving you with a personnel issue that could take time to resolve.
- SMEs are vulnerable to cash-flow issues. If you’ve yet to make provisions for a reduction in lending and funding, or an increase in interest rates, now is the time to bolster your financial defences. And with price rises for some imported goods set to increase, it’s likely that doing business is going to cost more.
- Admin and delays. Whilst much has been made of the unburdening of EU red-tape for businesses, post-Brexit trade with the EU may mean more customs paperwork and checks – especially in a no-deal scenario.