The vast majority of 2020 has, understandably, been dominated by the COVID-19 pandemic but businesses are now being urged to focus the mind and start planning for the UK’s impending departure from the European Union.
The 12-month transition period formally comes to an end at midnight on December 31 and, deal or no deal, the parting of ways will then be official.
Business advisers from SEMLEP’s Growth Hub have stressed the importance of understanding the impact this will have on your organisation and planning for what changes will need to be made as Big Ben strikes to signal the start of a new era for British business.
Ruth Cozens, Business Adviser Team Leader, has outlined the five key areas that businesses need to bear in mind when putting plans in place to be ready for the end of the transition period.
Importing and exporting
The end of the transition period will signal a change in the way you import and export to and from Europe and other countries around the world. There will be changes to tariffs and VAT and that is likely to trigger a short-term increase in paperwork – companies need to be ready for this and understand what a ‘no-deal’ scenario could mean for them. It’s time to explore potential opportunities from new trade deals and put plans in place now to ensure you are in a strong position come New Year’s Day.
Suppliers and supply chain
Organisations will need to consider the impact of changes to the trading landscape on their suppliers and contractors. Delays at borders are likely to impact the in-bound supply chain, potentially causing shortages of key inputs. Now is the time to agree plans with suppliers, review contracts and establish a plan to mitigate disruption at borders. It may also be an opportunity to look at diversifying and re-prioritising your target markets.
Rising labour costs and reduced access to EU workers means businesses will need to work smarter to attract, keep and develop the people with the skills they need. Government has now finalised the regulations on employing people from outside the UK and it’s important that if you are currently employing an EU citizen you know where they are from, that they have the right to be here and that you communicate clearly with employees – talk to them about potential challenges and opportunities and any changes you expect to make.
While 21st century advances in payment technology may mean cash is no longer king, money in the bank remains your majesty. Access to finance has been pivotal for many businesses during the pandemic but it is now vital that companies fully grasp that the cost of goods and the production of those goods may be about to change, along with exchange rates and interest rates. Businesses should review their cash flow and understand the dual impact that COVID and leaving the EU may have on costs, pricing and finance.
Regulation, legal and data
The end of the transition period will mean that your data requirements are likely to change. Any marking on goods, labelling or standards may have to be updated so now is the time to check if there are specific changes that affect you. Review data compliance, distribution processes and policy developments – keeping up to date with the latest changes to policies means that businesses can react quickly and informedly.
Whatever your sector, whatever your politics – businesses are united in one thing regarding the end of the transition period; uncertainty. None of us can be 100% sure of what follows next, but by talking things through and understanding the implications for your business you can put yourself in the best possible position to grow and prosper in years to come. Communication is key.
SEMLEP’s Growth Hub has compiled a suite of resources aimed at helping you navigate the wealth of information available to guide you through the transition period, including a Talkbook underlining the importance of continuity, compliance and cost. Visit the dedicated section of the Growth Hub website to read more or to book a one-to-one session with a business adviser.
For more information visit bit.ly/SEMLEP-EU-Transition