UK SMEs need ‘extra support’ following £1m shortfall

An overwhelming number of UK SMEs have said that ongoing uncertainty surrounding Brexit has cost them around £1m in lost revenue, with almost half blaming a lack of preparation on the government.

New research surveyed from 1,000 British businesses found that during the past three years just 5% had not experienced significant financial costs because of the UK’s vote to leave the EU, while a majority estimated they had suffered a £1m shortfall during the same period.

Brexit - United Kingdom and European Union - image courtesy of Depositphotos.
The UK is currently due to leave the EU in January 2020, having already been postponed twice – image courtesy of Depositphotos.

Paradoxically, half of those who took part in the survey said they felt more confident than 12 months ago, and nearly the same amount had plans to expand their customer base throughout the UK in 2020.

The mixed response, harvested by same day delivery company CitySprint, suggests UK SMEs “need some extra support to help navigate the specific complexities of Brexit,” according to Rosie Bailey, director of business development.

Collaborate UK 2019 marks CitySprint’s seventh annual survey of 1,000 UK SME decision-makers.

It found less than a third of those that took part had seen the government’s Get Ready for Brexit campaign, and little over one in five had accessed any government guidance surrounding Brexit since the vote to leave in 2016.

Nearly half blamed the UK government for not doing enough to prepare SMEs for the impact of leaving the European Union, and 43% lacked confidence in the administration’s ability to protect them from any potential fallout. That number has risen by 7% since 2017.

CitySprint said new recruitment, exploring new markets, and investment in new products and services were three areas SMEs had notably limited since 2016.

A twist in the tail

A puzzling quirk of CitySprint’s survey revealed a surprising level of resilience among UK SMEs, with half reporting they felt more emboldened than this time in 2018, and 49% said they were already planning to expand their UK operations next year.

Budget Annual Investment Allowance Finance Money Cash Growth - image courtesy of Depositphotos.
Paradox – despite uncertainty, UK SMEs are more confident than last year, and expanding their customer base in 2020 – image courtesy of Depositphotos.

Despite not knowing the proven consequences for trade and regulation once the UK leaves the EU (currently due in January 2020), 69% said they were planning to expand their customer base in Europe, an increase of 28% since 2018.

Another 38% told CitySprint they had made solid preparations for Brexit, while three-in-10 had put plans in place for a no-deal scenario. Around a quarter, however, were making plans for another Brexit extension.

“SMEs sit right at the heart of our economy. While it’s great to see that they feel upbeat and resilient, thanks to many years spent flexing their business to suit the times, it’s clear that they also need some extra support to help navigate the specific complexities of Brexit” said Bailey.

By Rory Butler, Staff Journalist