Preparing for Brexit – what your business needs to do now
AS we edge ever closer to the supposed deadline for agreement on the future relationship between the UK and the EU, without any clear sign that a deal will be struck, it can be tempting to consider ‘uncertainty' the new normal.
But this is a dangerous position to take and could cloud the fact there already is clarity around key elements of businesses' preparations that should be acted upon now, before time becomes even shorter.
Of course, we are not at the point we hoped we would have been in terms of wider certainty – and only the most optimistic observer expects a deal to be reached at the EU Summit later this month - but that's not to say there isn't significant steps that can be taken to prepare for Brexit.
Grant Thornton recently hosted a dinner with business leaders representing firms across various sectors in Northern Ireland and it was encouraging that all of those in attendance had taken steps to consider the implications of Brexit, particularly around supply chains, talent management, cross-border trade and legal considerations.
Frustrations were voiced however on perceptions of a lack of leadership from politicians on the matter and it was agreed Northern Ireland had suffered in this regard as a result of the political impasse at Stormont.
We have been working with clients from the very moment the EU referendum was announced helping to ensure their transition to the post-Brexit world will be as smooth as possible.
So, what can we be certain about? Firstly, we know that a ‘no deal' scenario is likely to entail the introduction of World Trade Organisations default tariffs so, at the very minimum, this is what companies should be planning for. Preparing for a ‘no deal', should mean that businesses are well on the way to being ready for the various other scenarios that might emerge.
We also know there are a number of ‘no regret' actions that can be taken now which would have a positive outcome no matter what deal transpires from the Brexit negotiations.
For example, we are observing increasing interest, especially from exporters, in seeking Authorised Economic Operator status, an internationally recognised quality mark indicating that a firm's role in the international supply chain is secure, and that its customs controls and procedures are efficient and compliant.
It is not mandatory, but it gives quicker access to certain simplified customs procedures and in some cases the right to ‘fast-track' your shipments through some customs and safety and security procedures.
When it comes to people management, communication is key and even just explaining to staff that a strategy for dealing with Brexit is in place will provide reassurance and could prevent EU workers from outside the UK seeking opportunities elsewhere rather than remaining with the firm.
We also know that currency fluctuations are likely to continue over the coming months and most analysts expect the pound to fall in value the more likely a ‘no deal' outcome appears. Firms should therefore include a review of foreign exchange exposure and opportunities and hedge now if possible.
To assist in the process of identifying those opportunities and minimise risks, we recently launched a Brexit Workshop which examines the business impact of certain potential scenarios through nine organisational lenses including customers and markets, suppliers and supply chain, tax and customs, people and workforce, as well as legalities around data and other regulations.
By drawing on these insights and professional service expertise, businesses can ramp up their contingency planning now and ensure uncertainty is not allowed to cloud their future success.
:: Peter Legge is tax partner at Grant Thornton NI