With negotiations staggering into extra time, a new survey shows that businesses in the South West remain confused about and unprepared for the consequences of Brexit.
Almost half (41%) of the 500 businesses surveyed by Business West said that the UK’s departure from the EU single market and customs union at the end of the Brexit ‘transition period’ would impact them.
A further 32% of businesses said that they remain in the dark as to whether they will be impacted by Brexit, such is the degree of complexity and uncertainty that surrounds the UK’s unravelling of its current trade arrangements with its largest trading partner. Agreeing a trade deal with the EU carries added importance for businesses in the South West in light of the finding that 91% of the 200+ respondents that regularly export goods or services abroad, do so to European countries.
The potential failure of government to deliver a trade deal ahead of the Brexit transition period ending on 1st January remains a top concern for businesses, even against the backdrop of a global pandemic, with 46% of businesses suggesting that Brexit not COVID is keeping them awake at night.
Of the 349 businesses who said that they will ‘definitely be impacted’ or are ‘unsure’ whether they will be impacted by Brexit, only 36% appear to have comprehensive insight and understanding of the consequences it will have on their operations. An alarming 12% of businesses (mainly SMEs) reported having no understanding of the impact of Brexit whatsoever.
Less than a third (31%) of businesses said that they felt equipped to adapt, while a quarter of businesses in the region admit to being unprepared and may well be in for a shock come 1st January.
A regrettably typical response of the 125 businesses falling into this category was offered by the owner of a Wiltshire-based IT company, who put a lack of preparedness down to scant resources: "[I] can’t think about implications yet as too busy with everything else. In addition, it’s hard to allocate resource until you understand the impact and we won’t know that until we know what the deal will be.”
Commenting on the survey findings, Phil Smith, Managing Director of Business West, said: “Much of the media attention of the last few days has been on the theatrics of UK and EU negotiations – pizza deliveries and all. Our findings highlight the worrying practical concerns that businesses still have and the vital importance of agreeing a deal. Even at this late stage many businesses say they still have a limited understanding of the impact of Brexit on their business or report they are not fully prepared for the UK’s departure.
“There is a real risk of a big shock to local firms if we leave without a deal. It also underlines the importance of a deal that includes phase in times to give businesses further time to adapt – a deal without delays in enforcement of the new rules risks creating a big economic bump in January.
“It is time to stop the drama, conclude the deal and give further time and support for local businesses to adapt. After a tough 2020, this is not the time to drag the economy through further uncertainty in the coming months.”
Customs declarations will be needed when trading with any country outside of the EU. For more information visit: https://www.businesswest.co.uk/export/export-documentation/chambercustoms
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