Update on Brexit for business – this article was written immediately after the results of the referendum. Some of it is still relevant, as we still don’t have much of an idea of how Brexit will affect small businesses.
The EU referendum vote last week has created a very busy week for me this week. In addition to my usual client meetings, I’ve had to spend a lot of time helping my clients to work out what Brexit for business might mean for them and their businesses, including one emergency meeting on Monday with a client who imports from the EU and who thinking about closing the whole thing down.
Nobody has a clue what’s going to happen
Although I’ve been reassuring people, I have no more idea of what’s going to happen than anybody else, including David Cameron. The peculiar thing about all of this is that none of the people who voted for Brexit (not me by the way) could have had any idea about what they were actually voting for, as nobody can tell which way it’s going to go.
This means that we all have to do make some decisions for the future of our businesses, based on incomplete information. As business people, are used to doing this, and were used to taking risks, but in this case, we have almost nothing to go on. No one knows what Brexit for business means.
Possible scenarios and how they might affect you – your Brexit for business
It is entirely possible that this whole Brexit thing might have very limited consequences for small businesses. We may go the “Norway” route, and join the EEA, which would give us freedom of movement (so I could go and live in Spain if I wanted to, and run my business from there) and freedom of trade.
Most of us would be unaffected by this, countries like Norway and Iceland who are in the EEA, but not the EU, are bound by pretty much the same rules as we’ve lived with for a while. If you import food or are involved in agriculture, you would be stuffed under this arrangement, as I learned that French cheese has a 400% tariff when it’s imported to Norway.
It may be that the EU guys don’t want us in the EEA, and that route is closed to us. We would then have to negotiate some hideously complex treaties with each and every country in the EU, which would make trading with them very different and difficult. It would also prolong this uncertainty, possibly meaning that we don’t actually leave the EU for ten years. If it goes this way, get ready to learn some very complicated rules and tricks if you want to be able to sell abroad.
Things to think about now we’ve got Brexit for business
Be very careful about any financial transactions, and double check that they have actually gone through as you expected. I’m hearing that some bank transfers and some people using TransferWise to send money abroad have not gone as expected. Be prepared to calculate some losses on sending money or receiving money from customers overseas.
This uncertainty of what’s going to happen is going to carry on for the next couple of years. It’s not going to be resolved in the next few weeks. And you’re still going to have to make decisions and run your business. I usually think that there is something worse than making the wrong decision, and that’s making no decision at all.
Don’t be tempted to put off strategies and decisions that you need to implement in your business. If you need to do something, such as buying new stock for your business or engage the services of a web designer from Portugal, don’t try and second-guess the financial markets, just do what you need to do for your business.
You might lose something on the exchange rate, or you might gain something on the exchange rate, but if you delay thinking that things will become clearer soon, you’re guaranteed to lose the opportunities you would have had by acting sooner.
Don’t be sad
Everybody have spoken to seems to be shocked and saddened by the result, even the people who voted to leave. It is a massive change for the UK, but there’s nothing you can do about it. I can’t influence the results of the referendum, and neither can you.
Your job now is to get on with running your business, making the money and forging ahead. Take a moment to be sad, angry, joyous, whatever it is that the referendum results brought up for you. And then, move on, Get on the rest of your life. Sell some stuff, talk to some potential customers, write a blog, but above all get on with it.
And get off social media
The vote was last week. It’s over now, and there’s not going to be a recount on Twitter. Social media can be great for getting people to hear about your new thing, to learn more about your business, but it can also be a great big time suck, especially if you get drawn into the analysis of what happened in the referendum.