As March 29 looms, a lot of uncertainty surrounding the events of what will happen on or after this date still remains. Understandably, many SMEs are concerned about the future of their business, with the unknown aftermath making things tougher to plan for. With much still undecided with regards to tariffs, taxes and immigration, you’d be forgiven for thinking there’s not much you can do to prepare for things.
However, there are plenty of practical steps your business can take now to prepare your business for Brexit.
Research potential regulation changes
As of right now, there are lots of different scenarios that could play out once the UK leaves the EU. It’s a good idea to spend time learning about what might happen with regards to regulation changes that could affect both your business and its employees. This way, you can get a better sense of things and what you might have to prepare for.
Some of the possible changes could affect anything from cross-border trade to travel between the UK and EU countries. For SMEs, consider the changes that might apply for each of the possible situations if the UK leaves the EU with regards to:
While the details for each potential outcome are obviously unconfirmed, it’s still viable to research the potential changes and other issues for each possibility. Waiting to see what the outcome will be, could be leaving it too late and result in reacting to events rather than actively adjusting to them.
Protect your supply chain
If a supply chain breaks down, then it can severely affect small businesses, no matter how minor the issue. If your customers aren’t receiving their products or service on time, then it could have the added knock-on effect of your business being the one who faces repercussions, not your suppliers.
Those in your supply chain should be making their own plans to deal with Brexit’s potential outcomes. Small business owners need to be mindful of every step of the supply chain and begin discussions with current suppliers now to understand their plans. If any suppliers in the chain are unprepared, unwilling to discuss their plans to combat the various possible Brexit outcomes, or have expressed doubts around their ability to maintain service levels, it might be worth switching suppliers before the date arrives.
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Increase the amount of UK stock
If your business relies heavily on importing from the EU, then you can look to increase the amount of stock you hold in the UK. Good stock level gives you more time to prepare an alternative if your current supplier relationships are affected after the effects of Brexit kick in. Whatever happens, you can prepare now to minimise disruption.
As it is unclear what will happen in the immediate and long-term aftermath of the UK leaving the EU, it’s impossible to determine whether your business’s imports costs could increase or not. Therefore, stocking up prior to Brexit could prove to be a wise investment.
It’s also important that your existing clients and customers make their payments on time. Otherwise, you may end up lacking the funds needed to increase your stock if they’re delaying payments in order to manage their own Brexit issues.
Minimise the impact of currency volatility
We’ve seen how volatile the sterling has been since the Brexit referendum, and it’s likely to continue post-Brexit. Having a system that is able to manage multiple currencies and the ability to settle using wholesale Forex (FX) rates is important. Fluctuations in FX rates can have a big impact on business and if invoice payments are delayed an SME might potentially lose money. Seek out software and programs that can settle invoices instantly and allow FX rates to benefit from real-time updates, which could help SMEs save on their FX payments.
Know your employees' nationalities
Regardless of whatever transition takes place, it’s vital for businesses to understand the rights and statuses of their EU workers to ensure they are employing them legally. Part of the ongoing Brexit divorce negotiations seek to guarantee the rights of EU nationals already in the UK, but monitoring your workforce in terms of where they work, their immigration status and their employment contracts is essential.
Additionally, if any EU nationals are required to move back to European locations after Brexit, then it makes sense to allow for remote working. With Cloud-based software and online collaboration tools, it’s easier than you think to let many existing employees continue their roles from overseas.
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