Everyone knows that small businesses are the key to the British economy’s success with SMEs or small and medium-sized enterprises making up around 60% of the workforce across the country. These small businesses are also responsible for around 50% of annual turnover. This means that in the ongoing Brexit negotiations, the position of the small business is a crucial one – but what do small business owners want from politicians handling the process?
Small business overview
One place to find a good view of the worries and interests of the small business owner is from the Federation of Small Businesses or FSB. Craig Beaumont is a representative of the FSB, which has around 200,000 members featuring the self-employed and those that run their own small business.
According to the FSB, businesses are already expecting short-term losses from the process. Examples including access to European funding from the Local Enterprise partnership and from the European Investment Bank for larger projects. Therefore, business owners are already hoping that the UK government will boost investment from the British Business Bank to help deal with this. And in the longer term, it could be a great opportunity to develop new sources of funding that are better than the existing ones and at the moment is ‘very opaque’ according to Beaumont.
Changes in trade
Another area that is expected to face problems is centred around trade. One in five of the FSB members businesses sell their services or goods outside of the UK and the EU single market is one of the biggest places that this trade goes through. By losing access to the single market, it is expected that trade is going to become more difficult and this is a big negative for many UK based SMEs.
The FSB members do hope that the UK government will use the opportunity to negotiate free trade deals with the rest of the world that will go some way towards helping to offset the losses from pulling out of the EU single market. Beaumont believes that if the talks are started early and done properly, that the benefits could again outweigh the potential losses from Brexit.
Currently, the US is the largest market for the UK to look more closely at, so the first priority would seem to be a deal with them, possibly under the Transatlantic Trade and Investment Partnership (TTIP), which was only just scuttled by some objections on both sides. Other Anglosphere countries such as Canada, South Africa and Australia are also important trade partners while China is also developing into a ‘big opportunity’ for British businesses.
Returning regulation to the UK
One of the motivating factors behind many people voting to leave the EU was the chance to return a lot of regulation back to the UK from the EU giving us the opportunity to control our own laws and regulations. Beaumont said that FSB members don’t want to see a ‘slash and burn’ approach to regulations in areas such as consumer rights and employee protections but do want to see smarter regulations brought about.
Health and safety, data protection and employment law are all areas that SMEs want to see the government apply new common sense in regulation. The idea would be to make the current rules more business-friendly and also far more streamlined, avoiding areas such as increasing regulation around data protection that is currently being proposed in Brussels.
Slower immigration change
One area where caution and a slower approach is advocated is around the area of immigration. The FSB does think that the idea of companies moving to the continent has been overstated. There is a definite feeling of concern around the question of EU staff working in this country as some business owners are seeing EU staff already leaving jobs and returning to their home countries in anticipation of potential new negative Brexit rules. This means that firm agreements need to be in place to help these people continue to work in the UK post-Brexit.
There is also hope that if new immigration laws lead to a drop in the available workforce, the government is going to take steps to help remedy this in some positive way. A clear and simple process is required to allow UK companies to hire EU-27 workers as restrictions are phased out. For example, workers below a certain threshold should not be allowed.
Hope for the future
Generally, the FSB members are impressed with the early responses from the government on the issues that concern them and the level of engagement between such parties. Weekly meetings between representatives of the organisation and senior government members have allowed discussions on how Brexit will affect the majority of SMEs and what can be done to offset this, including meetings with both Chancellor Philip Hammond and the Brexit secretary David Davis, leading to positive hope for the future once the process has been completed.
One thing is for sure, registered SMEs are in a better position to ride out Brexit and to flourish on the other side of it. Being a registered company, such as a Limited Liability Company or Limited Liability Partnership, will most certainly offer your business the best possible protection against an uncertain future. Having LLC or LLP status will mean that should your company fail in the future, your personal assets, such as your personal bank account and home, cannot be touched by your business creditors. You can compare our company formations packages to find out which registered company would suit your needs the best.