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Small firms need more Govt support to face no-deal Brexit
07 Oct '19
2 min read
Pic: Shutterstock
Small UK firms urgently need more government support to overcome lack of preparedness for a no-deal Brexit on 31 October, according to research by the Federation of Small Businesses (FSB), which shows among those small firms (39 per cent) that believe a no-deal scenario will negatively impact them, only a fifth (21 per cent) have prepared for anticipated issues.
Nearly two thirds (63 per cent) don’t think they are able to plan, according to an FSB press release.
Preparations for a no-deal Brexit have come at a high price, with the average cost for these businesses that have prepared, coming in at around £2,000. That average cost rises to £3,000 for smaller businesses that export and import.
Just under one third (31 per cent) of prepared small businesses have stockpiled ahead of 31 October, while 34 per cent report temporarily or permanently reduced profitability.
Just under half (46 per cent) of these firms, along with those that plan to prepare for no-deal over the next few weeks, think that the volatility in Sterling has negatively impacted their business. Almost half (46 per cent) of small businesses, that believe they will be negatively impacted by a no-deal scenario, would welcome some form of financial support.
Responding to the findings, FSB national chairman Mike Cherry renewed calls for the provision of financial assistance like vouchers worth up to £3,000 to assist with preparing for a potential no-deal scenario, including supporting small firms in reaching new global markets.
Given the number of small businesses unable to take specific actions to prepare, he also called for wide-reaching measures in an early budget to boost small business cash flow. These include a temporary reduction in value-added tax, an uprating of the employment allowance and extending the two year ‘retailers’ business rates discount of 33 per cent to a wider range of smaller businesses.
“Raising awareness is important, but not enough. The Government must also turn to meaningful financial support. This is desperately needed and would certainly provide a much needed shot in the arm for those firms that have already spent money preparing,” Cherry added.
Nearly two thirds (63 per cent) don’t think they are able to plan, according to an FSB press release.
Preparations for a no-deal Brexit have come at a high price, with the average cost for these businesses that have prepared, coming in at around £2,000. That average cost rises to £3,000 for smaller businesses that export and import.
Just under one third (31 per cent) of prepared small businesses have stockpiled ahead of 31 October, while 34 per cent report temporarily or permanently reduced profitability.
Just under half (46 per cent) of these firms, along with those that plan to prepare for no-deal over the next few weeks, think that the volatility in Sterling has negatively impacted their business. Almost half (46 per cent) of small businesses, that believe they will be negatively impacted by a no-deal scenario, would welcome some form of financial support.
Responding to the findings, FSB national chairman Mike Cherry renewed calls for the provision of financial assistance like vouchers worth up to £3,000 to assist with preparing for a potential no-deal scenario, including supporting small firms in reaching new global markets.
Given the number of small businesses unable to take specific actions to prepare, he also called for wide-reaching measures in an early budget to boost small business cash flow. These include a temporary reduction in value-added tax, an uprating of the employment allowance and extending the two year ‘retailers’ business rates discount of 33 per cent to a wider range of smaller businesses.
“Raising awareness is important, but not enough. The Government must also turn to meaningful financial support. This is desperately needed and would certainly provide a much needed shot in the arm for those firms that have already spent money preparing,” Cherry added.
Fibre2Fashion News Desk (DS)
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