Brexit uncertainty is increasingly dominating the headlines as the country moves through the final months of negotiation. With a ‘no deal’ Brexit now being touted as a realistic possibility, it’s safe to say that no-one knows exactly what to expect.
While there are many headlines that point to potential doom and gloom, not everyone is expecting the worst. www.turnerlittle.com examines…
A survey by OCO Global, a leading authority on global investment, has uncovered that many SMEs are feeling optimistic about the future of their business. According to the survey, more than 30% think that the UK leaving the EU will have a positive effect on their business.
London optimism about Brexit
The OCO Global SME Brexit Survey revealed that London businesses are the most optimistic, with half of those surveyed saying that Brexit will be positive for them. This is the highest regional percentage in the UK.
More than 30% of UK businesses report that they have already experienced a positive impact since the referendum in June 2016, particularly among those that rely mostly on exporting goods and services. Out of these, more than 40% report a positive impact since the Brexit vote and an additional 40% say that they think this will continue when the UK has left the European Union in March 2019.
Business improvement has also been reported by survey respondents. Around 37% said that they have attracted new contracts, customers and clients while 36% have boosted their sales from existing customers.
Sector by sector
Research covered 1,000 SMEs and was undertaken between 25 May and 4 June this year, showing the most up-to-date consensus as the country heads towards Brexit. While plenty of positivity came out of the report, perhaps more than some experts would have expected, around 6% of businesses surveyed said that Brexit downsides have been ‘very negative’ so far.
The report also clearly identified the sectors that report a positive outlook for their post-Brexit future. More than 50% of businesses that operate in Business Services are reporting general optimism, which is higher than in the IT (43%), Manufacturing (34%) and Retail (18%) sectors.
Business size and Brexit optimism linked
It appears that optimism levels also vary depending on the business size. Around 46% of SMEs are feeling positive about the future of their business after Brexit, compared with 30% of bigger companies. This is likely because Brexit is almost certain to disrupt large corporations, which will offer SMEs more opportunity to inch into market share.
The increase in positivity among SMEs has risen out of the upturn in business since the vote in 2016. As explained earlier, the businesses that have experienced more clients, more sales and more business include those that are already hosting overseas operations and are currently exporting goods and services.
They are also the groups that have been most bullish over Brexit. The fall in the pound in the immediate aftermath of the referendum led to competitive prices that led to overseas investment and a subsequent boom in exports. This has resulted in the manufacturing sector, for example, posting its strongest year since 2014.
New markets
The Government is looking to secure deals around the world outside of the EU so that UK businesses can export to new international markets. However, SMEs are likely to still consider Europe as the most significant market, and so any optimism will be tinged with caution at this time.
James Turner, managing director of turnerlittle.com said: “Post-Brexit business life will mean SMEs will have to seek opportunities outside of Europe, which will necessitate changes in attitude. Data shows that markets outside of the EU have historically attracted little interest from UK SME exporters, and the Government must find ways to support this change in mindset.
“We’re all waiting to see the effect Brexit will have on businesses in every sector of the UK, but it’s encouraging to see small businesses reflecting a change in outlook. At Turner Little, we work with small businesses, start-ups and more with corporate structuring advice, help with copyright and trademarks and UK as well as offshore banking. “
About Turner Little
Founded in 1998 in Yorkshire, UK, Turner Little is a specialist UK and offshore company formation, banking and corporate services provider. Our services include company formation, UK and offshore banking, asset protection, credit correction/repair, trademarking and trusts. Other services include Internet services, mail forwarding, wills and probate. Turner Little’s vision is to offer the best possible service, together with market leading products.
