Brexit Homework – How your business should be preparing for Brexit

By July 18, 2019 July 24th, 2019 Insights
Brexit Homework

Most UK businesses should have started preparing for Brexit a long time ago. Preparation is important, especially as Chambers of Commerce believes that all firms in the country will be affected by the event – even though some industries might feel a bigger impact than others.

The deadline for leaving the EU has changed to October 31st although there is yet no certainty whether the country will leave with or without a deal. There’s also no clear image of what a deal could look like. This means that businesses must continue preparing for Brexit with an open mind.

What is the latest Brexit situation?

The UK and the EU agreed to delay Brexit for the second time earlier this year. At the moment, the date for the UK’s exit from the EU is set to happen on October 31st.

How the UK will leave is still a mystery and all sorts of options are still on the table. The country could:

  • Leave without a deal
  • Leave with the agreement deal negotiated by the EU
  • Leave with a new deal that the new Prime Minister would negotiate
  • Seek for another extension
  • Remain in the EU

There is a great guide on the BBC website on the different outcomes and what they might mean for the country. For businesses, all these scenarios mean different things in terms of business operations so it’s important that plans for preparing for Brexit are rigorous and comprehensive.

Preparing for Brexit – The key things to do

Brexit homework right now has not changed much. The key is to understand the realities of those different situations and analysing how your business can respond to the changes that might be ahead. In addition, there are certain preparative steps a business can take in terms of compliance and Brexit management.

Examine your business operations

Brexit will have an impact on four major areas of business operations. These are:

  • Supply chain
  • People / workforce
  • Finances / economic impact
  • Legal and regulatory issues

Business preparations for Brexit will look different for each business, as different sectors and types of businesses will be affected uniquely. It’s important for each business to identify how they might be affected in all of these key areas.

A business must take three major steps right now to ensure the continuation of business operations without too much of an issue. These are:

Risk assessment

You’ll have to conduct a risk assessment in all the above four areas. For example, performing a risk assessment for your supply chain ensures you can respond to changing market conditions. Your business will be able to consider stockpiling products or finding alternatives to ensure the continued flow of goods and services to customers. Of course, risk assessment of the economic conditions is also crucial. Just recently, there has been a warning that a no-deal could cause a recession. You will have to know the impact of varying economic conditions and be aware of how able your business is to withstand them.

Understand the changes in business conditions and their impact

A clear plan for Brexit is also about an improved understanding of the changes ahead. It’s important to comprehend the regulatory framework under the different Brexit scenarios. Your business must know how conditions will change under a no-deal scenario or what the current agreement means for your business. One of the major areas of impact are the different certifications products and services have. Non-tariff barriers can include things like packaging rules and it’s crucial to identify these prior to Brexit. ICAEW has good guides to help you get started.

Develop and test business continuity plans

As you have a better understanding of the changes and your business has conducted a comprehensive risk assessment, it’s time to develop and test various continuity plans. At this point, you need to develop a plan for all the above scenarios.

The good news is that there are many tools to help a business with the preparations and the above steps. One of the main things you can do is go through your unique business situation with the government’s tool for preparing for Brexit. The tool provides you with comprehensive information regarding your relevant sector and business type. It talks about regulatory changes and shares information on specific rules and regulations your business must be aware of.

Register with the right systems

In addition to assessing and analysing business operations, certain procedural steps should be taken.

First, you should make sure your business is registered for the Economic Operator Registration and Identification (EORI) number. You can find information about the number on the government website.

The other important procedural step involves EU citizens. If your business has employees who are EU citizens, then they should apply for settled status to guarantee they can stay in the country after Brexit. It will also help a business’ ability to prove employees have the legal right to work in the country under the different Brexit scenarios.

Get the right help to prepare your business for Brexit

Brexit is a complicated issue that’s riddled with uncertainties and unknowns. It’s important to make plans and preparations with full knowledge and understanding of all the eventualities. This means that for many businesses seeking expert advice is crucial.

We at Devonshire Green can help businesses preparing for Brexit. If you are unsure about how Brexit will impact your business, contact our team today. We can help you understand the latest developments and to identify the right preparation plan for your business.