FSB says Brexit uncertainty is harming small firms
Small firms could face significant difficulties in the wake of Brexit uncertainty, according to the Federation of Small Businesses.
With just over 20 weeks until the UK is due to leave the EU, the FSB has warned that uncertainty is negatively impacting on investment, finances and staff recruitment.
The organisation has suggested that both time and money are being wasted as a result, and that many small firms are struggling to overcome the costs involved.
Research from the FSB has revealed that numerous businesses are preparing for a ‘no deal’ scenario, and of those, 27% have spent more than £2,000 on planning costs.
Meanwhile, one in ten firms have spent more than £5,000, while 7% have spent more than £10,000 – valuable finance that could have been spent on other aspects of business.
Some 35% of businesses said they would be forced to postpone or stop innovation and development decisions, while 21% warned they would have to cut staff numbers or reduce labour costs.
As a result, the FSB has called on the government to ensure that any deal does not damage the UK’s small business ecosystem.
FSB National Chairman Mike Cherry suggested the current outcome should be viewed as a “political failure” before adding that a no deal scenario is both “damaging and dangerous” for small companies.
The additional financial pressures placed on small businesses could be “catastrophic” in the long‐ term and Mr Cherry has urged small firms to take action by planning ahead.
Those under financial strain may want to consider contingency planning to ensure they have a range of options and procedures available.
This can ensure that positive outcomes can be reached should a business be left facing insolvency or in need of other measures.
The FSB has also warned business owners to consider what other actions might be necessary to prepare for a post‐Brexit trading environment.
By Phil Smith
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