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19th December 2018

Brexit: South West businesses unprepared

The terms on which the UK will leave the EU next March remain up in the air, but how are businesses preparing? Thrings recently partnered with Insider to find out how companies in the South West are faring since the announcement of the withdrawal agreement.

Brexit continues to dominate the headlines, but the majority of businesses across the South West of England are not taking steps to mitigate the risks.

This is one of the major findings of a survey of 300 businesses in Bristol, Bath, Swindon and the wider South West region by Thrings and business publication, Insider.

Almost half of respondents (48%) admit to having taken no active steps other than keeping up to date with developments, only a quarter (26%) say they have read the Government’s ‘no-deal’ Brexit guidance, and just 22 percent have undertaken some form of Brexit risk assessment.

Contracts with suppliers, customers and subcontractors are one of the high-risk areas for businesses since the ability to honour them could be jeopardised as of April 2019. Interestingly, only 16 percent have analysed their existing contracts from a Brexit perspective and 19 percent are taking Brexit into account when negotiating new contracts.

Kate Westbrook, commercial contracts partner at Thrings, told Insider: “Businesses would do well to review the potential Brexit impact of any contract which might still be in existence after 29 March 2019.

“In particular, things like responsibility for delays, price variation mechanisms, payment of tariffs and handling customs clearance can be looked at to reduce the impact of any Brexit upheaval.”

According to the survey, 27 percent of businesses are making contingency plans in case of a no-deal Brexit, with 21 percent preparing for a potentially “unsatisfactory” future trading relationship with the EU.

However, this suggests that most businesses remain unprepared for a no-deal Brexit. Whilst the vast majority (81%) would not welcome a no-deal scenario, Kate Westbrook believes businesses should continue to hope for the best but prepare for the worst.

“The potential impact of a no-deal Brexit should not be underestimated,” she says. “The Government is ramping up preparations for this and businesses should too.”

The Brexit Deal or No Deal survey was carried out between 26 November to 11 December 2018 among owners and directors of businesses spanning a range of sectors, including manufacturing, financial services, agriculture and fisheries, real estate and construction.

Keep up to date with what Brexit means for your business – including the possible impact of a no-deal Brexit – by visiting Thrings’ Business of Brexit pages or contacting Kate Westbrook.

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