Brexit panel delivers top tips on how to prepare your business for Brexit
30th November 2018
As part of this year’s Coventry and Warwickshire Business Festival, HB&O Associate Director, Steven Mugglestone, led a panel discussion about preparing for Brexit in partnership with a range of business and financial experts. The panel outlined how Brexit could impact businesses, answering some of the common questions raised by business owners in the region. With the government’s proposed Brexit deal due to be debated by MPs within the next few days, the panel debate was certainly timely.
The panel comprised Steven Mugglestone, HB&O (chair); Philip Costigan from Band Hatton Button; Roger Scott, Area Director of SME Banking at Lloyds Bank; David Stokes, Chartered Financial Planner at HB&O Financial Services; Nick Evans, Partner at ehB Reeves; and Matt Hardy, Partner at Poppleton and Appleby. Each panel member provided a short overview of the specific challenges they are facing in their respective fields due to Brexit.
Phillip Costigan explained that the principal concerns from a legal perspective were non-tariff barriers such as bureaucracy and employment issues. However, the majority of SME’s have taken the view that in the long run, these issues will get sorted. He also addressed rumours that EU laws would no longer be valid following Brexit. While a host of legislation has filtered through from the EU, all EU law is still confirmed as UK law, so everything currently in place will stay in place when we leave the EU.
Roger Scott followed by discussing the challenges of Brexit from a banking point of view. The prominent issue stemmed from fluctuating exchange rates causing an unstable value of the pound. Roger said: ‘I would strongly suggest agreeing a pre-agreed exchange rate before signing new contracts if trading with business in Europe. In doing this, it can give you certainty in an extremely volatile environment.’
A common concern affecting all business areas – particularly investments - was short term volatility. David Stokes emphasised the importance, now more than ever, of taking a long term view when considering investments. While Brexit is contributing to market volatility and has created certain barriers to investment, like with any other international or regional pressure, David encouraged delegates to build contingencies into their financial planning strategy so it can cope with unexpected or significant change.
Nick Evans followed by highlighting the cyclical nature of the property market and the ten year cycle that would likely see a realignment of values in the coming years. However, he noted that there is also a danger that the uncertainly surrounding Brexit could potentially cause us to talk ourselves into a far worse situation by restricting investment into property.
Matt Hardy stressed the increased necessity to identify and react to the opportunities and threats facing your business to enable businesses to weather any Brexit-related storms. This should include a thorough look at the landscape that your business is operating in to assess its position and reassessment of creditors to ensure steady cash flow.
Steven closed the panel introductions by clarifying the accountancy and tax aspects and assured the business community that Brexit would not result in major changes to tax, VAT and accounting processes until at least 31st December 2020. Free trade, zero tariffs and no fees will continue until then, giving businesses an extended period to assess their current position.
During the question and answer session, panel members were asked if a no deal Brexit would be better for business than the current deal on the table. The unanimous answer from the panel members was no. In their view, a no deal Brexit would only increase the insecurity facing businesses in Coventry and Warwickshire.
Unsurprisingly, uncertainty was an overwhelming theme that emerged from the discussions and while this creates potential difficulties and issues for the local business community, the panel experts reiterated that with careful preparation and contingency planning, businesses would put themselves in a much stronger position to navigate the unpredictable journey ahead.