At the end of March, Theresa May triggered Article 50. So, now that Brexit is officially underway, how can we expect UK SMEs to fare?
What do small businesses want from Brexit?
The Guardian recently published an article revealing what small businesses want from Brexit negotiations. With 92% of UK exporting small businesses and 85% of importers trading with the EU, a trade deal is still the hot topic. Research released by the Federation of Small Businesses in fact puts trade deal with Europe top of the list of small businesses demands for Brexit. More than half of exporting small firms say trading with the EU is significantly easier than dealing with non-EU countries.
Where does this leave Britain’s small business community after Article 50? The research reveals that they have real concerns about the tariffs that’ll be imposed once the UK leaves the single market. A third of exporting firms say they would be deterred from trading with the EU if a tariff of between 2-4% were to be applied.
Could it be a positive change?
Despite Britain’s SME leaders remaining concerned about the impact of rising supply costs and higher price inflation, a survey of 416 businesses by eBay showed that 46% were confident about their growth prospects, compared to 19% who weren’t so positive.
The survey of 1,000 businesses suggested that, despite the uncertainty, small business leaders are more confident about the future of their own enterprise than they were 12 months ago. What is more, according to Amazon UK and Enterprise Nation’s SME Growth Tracker, SMEs are projecting revenue growth of 2.3% over the next 12 months – the third quarter in succession that the target has been revised up according to an article by The Independent.
Small Business published an article that, again, relays the impression small businesses are feeling good about the UK’s impending departure from the EU. However, small business owners’ big concerns include finding and retaining quality employees, managing cash flow and winning new customers – all of which are expected to become more difficult once the UK leaves the EU.
Media businesses hit hardest?
New research from Hitachi Capital Business Finance indicates that a quarter of SMEs in the media, marketing, advertising and PR sector will rely on the EU market for growth over the next 12 months. However, more than half (55%) don’t believe leaving the EU presents any benefit or opportunity for their business. In fact, they anticipate taking a hit in the short term. “Media SMEs were among the most likely of the 15 sectors surveyed to anticipate a period of decline in the next three months” – Smallbusiness.co.uk, March 2017.
Whilst the fate of some, if not all, small business sectors remains unclear, business owners are still feeling optimistic about the forthcoming change.