On Monday 5th November 2018, Esther attended a Brexit event hosted by CABS in Westminster.
The format was a panel discussion followed by questions from the floor.
Guest speakers included:
- Michelle Ovens – Small Business Charter
- Lord Young – Entrepreneur & Formally David Cameron’s Advisor on Enterprise
- Neil Warwick – FSB Policy, Partner at Square One Law Firm
- Richard Davies – TSB bank
- Emma Jones – Enterprise Nation Founder
- Professor Mark Hart – Aston Business School
Neil, Richard, Michelle, Emma & Mark (from left to right)
There is a world beyond Europe and a time beyond Brexit…
The message of the day was a positive one and made it clear that for small businesses Brexit is an exciting opportunity.
Small businesses are innovative and able to cope with opportunities, they are also flexible and can change course very quickly and efficiently, adapting to threats. With this in mind the Brexit situation should be treated no differently from GDPR, Making Tax Digital, Pension Auto Enrolment or any other changes in legislation that has impacted you in recent times.
In fact Liam Fox, Secretary of State for International Trade, has been quoted recently as saying “There is a world beyond Europe and a time beyond Brexit”, which is valuable advice.
Hope for the best but prepare for the worst!
Good working practices, clear leadership and efficient processes will insulate businesses from any temporary wobbles in the economy. The EU gives us four freedoms and therefore you should consider a contingency plan in each of the following areas:
Drilling in further Professor Mark Hart explained the importance of the three Cs:
Customers – who are your customers, what do they want, why do they choose you, where is your area of risk?
Capacity – what are you doing to service your customers efficiently, do you have sufficient resources, are you lean and what is your value per head?
Cash – Ensure you have a good relationship with the bank in case you need funding and perhaps now is not the time for investment!
Not unsurprisingly, there was a lot of discussion around how businesses should export to Europe after Brexit. You have the option to become a Trusted Trader, however this is a huge admin burden, requiring over 500 pages of evidence to be submitted. Instead use a freight forwarding company who is a Trusted Trader already, such as DHL, Amazon etc.
The message was clear that the appetite for UK products and services is growing around the world and many exporters find Europe to be as challenging as the domestic market, however looking further afield will give you a better opportunity to sell.
Rather than adapting for Brexit alone, use this opportunity to review your whole business model to see how you can improve in all areas. What’s your footprint, are you a regional, national or international business. If you think outside of your comfort zone could you expand to develop in these markets?
Forget Brexit concentrate on Digital…
Developments in technology are fundamental in becoming more efficient and to boost growth. The opportunity with digital tools is better than ever so you should forget measuring success by the number of staff but instead look at the value generated.
Examples were given of a very successful Amazon business owner, running an enterprise from her bedroom but benefiting from the Amazon fulfilment centre and Amazon market place giving them an annual turnover of £1million+ from one employee!
In many ways, the noise and uncertainty around Brexit and the resulting devaluation of the pound will make it cheaper to come to the UK and therefore we are likely to see tourism grow.
Trademarks, designs, copywrites etc are not impacted by the Brexit dealings.
Biggest dangers of an EU supply chain
The media has been scaremongering in two key areas. Rather than believe the hysteria you you need to push back within your supply chains. Work with suppliers to achieve collaboration.
- Try to avoid stockpiling. This will cause you problems with cash flow and storage capacity issues.
- Try to avoid pressure to inlude Brexit clauses in your contracts. Speak to a legal professional if you need help to push back.
An alternative to importing from the EU, which many are considering, is to bring your manufacturing requirements back onto UK soil. It’s likely to be cheaper and the developing nations are clamouring for all things quintessentially British!
Should you open a Dublin office?
No, you should avoid any drastic separation plans, especially when we don’t know the details of the deal. Spending time on these strategies is going to take a huge amount of your time, money and energy, when you should actually be concentrating on being more efficient and growing nationally.
Deal or No Deal?
Lord Young made it very clear that Germany need the UK and generally what Germany want the EU delivers. With this in mind, the likelihood of crashing out of the EU without a deal is highly unlikely. We will know for sure on 26th January 2019 but all indicators are pointing towards a workable deal.
There is lots of support for Entrepreneurs concerned with Brexit but the responsibility has to be for the business owner to go out and get it, for example from your freight forwarding company, the banks, department of trade & industry etc. Ask lots of questions and do your research.
Of course, you can also work with your accountant to review your management information, helping you to plan and create cash forecasts for your business.
It was a very positive Brexit event.
There was genuine optimism that Brexit offers huge potential to small businesses. As with all areas of change you should concentrate on the opportunities.
Eventually Brexit will be behind us, it will be branded as a success for both sides and the UK will go back to business as usual!