Navigating the best path to the EU exit door

Posted on 18 May 2017 by The Manufacturer

At last, the negotiations on the UK’s exit from the EU have begun. UK manufacturers with interests in Europe are as uncertain as anyone else about how the negotiations will go and what the impact will be on their businesses.

John Burn and Steven Barr of The Manufacturer’s consultancy team Hennik Edge consider what might happen next, and introduce a tool for manufacturers to keep track of their readiness for what may lie ahead.

Union Jack EU Exit Europe Flag Stock Image
Companies that came out of the 2007 financial crisis thriving were those who actively sought opportunities to invest and get ahead of the competition. The Manufacturer aims to keep you well informed about what’s happening and how it might affect your business and prospects.

So far, the UK’s exporters have done rather well as the pound weakened following the vote last summer for the UK to leave the European Union. But already import cost rises are starting to outstrip the export price advantage and the growth spurt is starting to slow.

Now that the two-year negotiation period has begun, what will happen next? And when? What will be the impact on UK manufacturers participating in supply chains with EU buyers and suppliers? How will manufacturers, who already have to deal with a shortage of skilled labour, handle stiff competition from EU and other overseas rivals?

A timeline marked with uncertainties

First, let’s look at the timeline of leaving the EU. Key EU influences on UK manufacturing are not just directly related to the negotiations schedule. European elections and other events will also have uncertain impacts.

Plus, there will also be a transition period beyond the exit. Manufacturers will need to position themselves strategically to benefit from the opportunities that emerge – and to manage the risks. The timeline above identifies some of the major milestones between now and March 2019.

How will EU exit impact your business?

The government’s consultation on a modern industrial strategy provides a timely checklist of potential impacts on UK manufacturers. Given what we know (or think we know) about what lies ahead, how vulnerable are you, and what are you doing to deal with impacts that could arise from:

  • Less scope to innovate with the EU’s researchers, universities, investors and customers
  • Reduced access to skilled workers in EU countries
  • No EU regional funding for the local and national infrastructure you depend on
  • No EU funding and changing relationships with EU-based investors
  • Restricted UK access to EU state procurement and EU company access to UK state procurement
  • Tariffs for access to UK markets by EU competitors, and for UK companies trading with the EU
  • Reduced confidence among EU financial institutions for investing in UK companies
  • Regulations relating to energy and the environment, and changes in the cost of energy imports from the EU.

Track your readiness

Using The Manufacturer’s Quarterly EU Exit Survey, we have devised a simple but effective way of helping manufacturers to navigate the EU exit process as new information emerges.

By answering a few key questions, manufacturers can track their own progress and benchmark themselves against peers by size, location and sector.

If you are a UK manufacturer you can take part in our Quarterly EU Exit Survey via The Manufacturer Collaboratory by following the link: Take the survey –

Dr Steven BarrMD of Hennik Edge and manager of The Manufacturer Collaboratory

Steven is a chartered engineer and business consultant who helps manufacturers collaborate with other organisations for advantage in all stages from design to customer use. He is an active contributor to university research, and a member of the IET’s Manufacturing Policy Panel.

John Burn consultant, Hennik Edge

John is an experienced programme manager specialising in IT-enabled business change, sourcing and regulatory-driven change. He has worked with manufacturing, energy, defence and finance companies to give them competitive advantage through effective IT systems and business processes.