Tips To Prepare Your Business For Brexit
Brexit is coming. Is your business prepared? Prepare your business for Brexit with these tips
It almost feels like the government has been playing a bad game of juggling with the idea of Brexit, doesn’t it? One moment it is on, the next moment it is off – you don’t quite know what to believe, do you? One thing is for sure, Brexit is around the corner – it is coming whether we like it or not – even if it’s taking its time. Brexit is inevitable. One question you need to be asking yourself is; is your business really prepared for Brexit?
It might seem a little premature preparing your business for Brexit when there is still so much uncertainly around it, but the reality is that businesses buying from and selling to the EU need to have some sort of backup plan in place to ensure that they survive the changes. Changes, like Brexit, are inevitable in the coming months in the UK.
4 Ways to Brexit-Proof Your Business
Below are 4 tips you can use to make sure that your business is prepared for Brexit.
Determine where your business can get extra cash flow, if required
What most businesses fear is the uncertainty of a no deal Brexit and what that could mean for their cash flow. Of course, in times of economic downturn or uncertainty, the best you can do for your business is be prepared. Where will you get extra cash flow if you need it when Brexit finally strikes? Brexit might set your current business dealings on hold. How will you afford your regular expenses and keep your business thriving during the transition phase?
Business funding is not always as easily accessible as we would like it to be, especially in times of financial uncertainty. Brexit could mean that High Street banks make it even harder for the average entrepreneur to get the money they need. Where does that leave your business? One potential option is that of unsecured business loans which are often available from £1,000 – £500,000. This type of business funding is designed to be flexible, often comes with no setup fees attached, and pays out within 24 hours. Another major perk is that most lenders with unsecured loans on their “menu” also provide loans to those who have a less than perfect credit score. This is something to look into.
Have a better understanding of how extra customs duties will impact on your supply chain and sales
Here is the reality; if there is no deal, your imports and exports will be affected. Once you know where you extra business funding is going to come from, you need to have a better understanding of the commodity codes in place for major exports and imports and how those will affect your specific business. You also need to know the tariff rates that would apply to your business.
If your business has been trading with the EU up until now, you might be thinking “whoa, what are custom duties and tariffs?” and these can be difficult for UK business owners to fully understand. Until now, countries that form part of the EU have had to pay no tariffs on trade, but once the UK leaves the EU and if there is no deal in place, EU tariffs will apply. What these will be will depend on: the type of goods (this is where the commodity code comes in), where the goods are being imported to, and the initial origin of the goods. Of course, you want to pay the lowest possible tariffs and duties and you can only do that by being aware of how it all works and how your business will be affected.
It is highly recommended that you do some research into whether your business and its trade could possibly have a “most favoured nation tariff” or “preferential tariff” attached. You also need to do a bit of digging to find out which commodity codes affect your business specifically. If you want preferential tariffs, you need to have all your documentation available, including documents that prove the original origin of your import and export goods. This could take some time to get together, so starting now is a good idea.
Know who your employees are and how Brexit will affect their working rights
Until now, you have probably had no problem sending employees between the UK and Europe. There has been no need for a visa for UK and EU individuals up until now, so it has been “business as usual”.
Brexit could mean that new visa limitations apply to both UK and EU based employees. If you send staff to EU areas or employ individuals in the EU, their working rights might be affected. It is best to keep on top of this. Start the paperwork early by collecting data on all employees and having a list of individuals that will need to be assisted when Brexit comes around.
Prepare your business for customs with an EORI (Economic Operator Registration and Identification) number
It is important not to get caught up in the thinking that additional business funding is the only thing to consider if Brexit happens with no deal in place. Customs might prove an even bigger problem. If the UK gets a no deal Brexit, it means that all goods will need to pass through customs. Not only does this mean mammoth amounts of custom declaration paperwork, but also delays in the movement of your goods.
Your business EORI number must be supplied with all of your import and export documents each and every time. While the HMRC sent these numbers, which start with “GB”, to all VAT registered business in the latter part of 2019, it seems some businesses do not have theirs yet. You can apply for it here.
Take Your Business a Few Steps Closer to Being Brexit Proof
Brexit proofing your business is going to be no easy feat. In fact, that is precisely why you need to start setting precautions in place now. Whether it is a deal or no deal Brexit that transpires, there are certain changes that your business is going to have to make in order to be compliant. Having a mind-set of change now will help you to do all that needs to be done and prepare your business for a seamless Brexit transition. Follow the 4 steps above to ensure that your business is a little closer to being ready for Brexit.
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