Under a third (28 per cent) of small firms in the North West believe that a no-deal scenario on October 31 will negatively impact them, according to new research from the Federation of Small Businesses.
Only one in ten (13 per cent) believe that it will have a positive impact on their business. And only one in five (21 per cent) have planned or prepared for anticipated issues. Nearly two thirds (63 per cent) don’t think they are able to plan.
The Brexit bill so far for these businesses that have prepared, averages at £2,000. That rises to £3,000 for smaller businesses that export and import.
The survey also found that 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.
FSB National Chairman, Mike Cherry, renewed calls for the provision of financial assistance such as vouchers worth up to £3,000 to assist with preparing for a 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 VAT, an uprating of the employment allowance, an expansion of HMRC time to pay arrangements and extending the two year ‘retailers’ business rates discount of 33 per cent, to a wider range of smaller businesses.
He said: “As the risk of a chaotic no-deal Brexit on 31 October remains alive and kicking, it is worrying that many small firms have either not prepared or are finding that they can’t prepare.
“Ongoing uncertainty is to blame for preparations hitting the skids with the picture still not clear as to how the UK will leave the EU on 31 October. Until we get clarity, small firms must prepare for the cliff edge where possible, and make preparations for a no-deal Brexit.
“Preparing for this outcome is coming at a high price though with small firms being hit by an unstable pound and having to shell out money on a potential outcome that has been highly disruptive, remains uncertain and is unwanted.