SMALL businesses are woefully underprepared for a no-deal Brexit with many in the dark as to what to expect.

The British political landscape remains uncertain, but the country continues to race towards the Brexit finish line. As a result, it is imperative that all firms are prepared; whatever the outcome. If it is a ‘Hard Brexit’; that is a Brexit without a trade deal with the EU, firms should have contingencies in place. Unfortunately, small businesses are disadvantaged by their physical size, as well as the size of their capital, and such preparations are simply not being made.

According to a survey by The Federation of Small Businesses (FSB) just 14 per cent of small firms have started plans for a hard Brexit. This could leave many small business owners in a vulnerable position next March when Britain’s exit from the EU will be set in motion.

Further results from the survey found that 41 per cent feared the impact from a no-deal Brexit but had failed to start planning for the eventuality. A smaller figure of 10 per cent thought a no-deal scenario would have a positive impact on their ability to do business. This contrasts the 48 per cent which believed the impact would be negative.

Most disconcerting is the action that small businesses have undertaken in an effort to prepare for the onslaught. According to the FSB, thirty-five per cent of small businesses are ready to postpone major business decisions or innovations, while roughly 21 per cent say they will cut staff or expenditure.

This negative reaction is largely motivated by ignorance; mainly an unawareness of what a post-Brexit landscape will look like. An easy fix would be to see residual uncertainty disperse through the government’s conciliatory talks with Brussels. These Brexit talks are not progressing well, however, so business owners have to locate some financial confidence independently.

 

FSB National Chairman, Mike Cherry, said: “What we need now is the Government to work with the small business community to ensure that they are adequately prepared and supported if a no deal Brexit becomes a more likely outcome in the coming weeks.

“The concern is that with only six months to go before exit day, we are now in a race against the clock to avoid a situation where we crash out of the EU causing significant damage to our smallest businesses. This must be avoided at all costs."

At the Credit Protection Association, many Members have admitted to Brexit anxiety. Business owners may believe diminishing business will help them prepare for Brexit, but this is not necessary. The Government needs to educate firms on what to expect as well as assuage some of their concern. In the meantime, CPA can ease financial worries and strengthen finances for the tough year ahead.

Here at CPA, we are particularly proud of our credit monitoring services. While our debt recovery and collection teams recover debt and free up cash flow, our credit protection and information services ensure financial strength is secured. The CPA credit reports, credit checks, company and directorship databases and County Court data, all protect Members from future distress. Whether this includes bad payers, late payment or Brexit fallout, our services ensure our Members’ finances endure it all.

 

Please call us on 0330 053 9263 to discuss how CPA can help your cashflow.
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