How will Hoddesdon business be affected by Brexit?
Brexit hasn’t been out of the news since the vote to leave took place in June, and although the majority of the news stories concentrate on the effects of Brexit on larger companies, not many have looked at the SME in a local context.
The overall picture is still confused. At the end of September, the CBI reported business confidence worsened, but a GfK survey showed consumer confidence had risen slightly and are now back at pre-Brexit levels.
Smaller companies are less exposed to the global markets – the government estimates that out of the 5.4 million UK SMEs, only 110,400 traded with other EU countries. One poll discovered around half of businesses outside London think Brexit won’t disrupt their activities and nearly 70% are feeling more confident than they were last year, but inside London, that confidence drops to less than 50%.
Sarah Smits is the Finance Director of Hoddesdon business Ashbourne Insurance. Her biggest concern is the impact of regulation and compliance on the business. “We are only licensed to trade in the UK with UK domiciled insurers and customers, so there has been no impact to our client base or supply chain. We are mostly concerned about how Brexit will affect will affect regulations – until now regulation for financial services was dictated by EU laws, so we’re not sure if post-brexit regulation will mean more rules, regulation and red-tape or less?”
The chair of Hertfordshire FSB, Pam Charman, isn’t optimistic about how things could go for local SMEs in Hoddesdon. “Recent FSB research showed small business confidence to be at its lowest levels since 2012. FSB members are the backbone of the UK economy and it is crucial that their concerns are put front and centre in the Brexit negotiations, and that we work harder to get start-ups and other businesses to export to new markets. Now, more than ever, UK economic growth rests on the future success of our small businesses, and smaller businesses want access to the European markets, the ability to hire the right people, reassurance on key EU-funded schemes and a new approach to both regulation and de-regulation.”
Keith Grover, MD of HB Accountants advises to keep records to assess how Brexit might be affecting your business. “The feedback from their clients and local contacts is that it is still largely ‘business as usual’ at present, though there is a certain degree of caution about the future. What SMEs need to do is monitor how the business is doing by preparing regular management accounts. We already do this for a number of companies as well as budgeting and acting as a virtual finance director.”
If you would like to explore this area further, please do not hesitate to contact HB Accountants for help with management accounts as well as a range of accounting services, including advice on your growth strategy.