IMPORTS THREAT
UK risks sleep-walking into nightmare, says boss
UK could risk sleepwalking into Brexit nightmare, warns boss
ONE IN four Yorkshire-based SMEs which buy from EU suppliers would be unable to operate without those imports, new research has revealed.
Nationally, as many as a third of the UK’s 1.1 million SMEs with EU suppliers would be incapable of continuing operations without them, according to the latest SME Confidence Tracker from Bibby Financial Services (BFS).
The news comes as a ‘no-deal’ Brexit threatens to disrupt trade between the UK and EU, and Single Market access looms large on the UK’s political agenda.
The research also shows that nearly two in every three (63 per cent) of Yorkshire SMEs that import from the EU would expect profits to fall if they could no longer access the Single Market.
Worryingly, 38 per cent of businesses in Yorkshire would struggle to find alternative suppliers outside of the EU (UK 55 per cent).
Edward Winterton, UK CEO of BFS, said: “Brexit threatens to completely derail the streamlined importing processes the UK has in place, which many SMEs rely on to source the goods they need to survive and thrive.
“Historically, imports haven’t had the same focus as exports when it comes to the UK’s trade targets. It is time eyes were opened and importing recognised as equally important for SME survival. Unless importing rises higher up the Government agenda, the survival of SMEs could be put at risk.
“If a poor, or no deal, becomes a reality we can expect an increase in customs paperwork and delays at ports, all of which would be catastrophic for SMEs reliant on imports.
“As it currently stands, business owners are faced with having to prepare their supply chains for the unknown. SMEs need to see the Government recognising their concerns, or else we risk sleep-walking into a nightmare.”
Recent research by the British Chamber of Commerce and BFS found that three in five (62 per cent) UK SMEs have not done a risk assessment on the impact of Brexit on their business.
One that has, Inspired Pet Nutrition (IPN), is concerned about the availability of some of its key ingredients in the event of a hard Brexit. The Thirsk-based firm, which is the UK’s largest independent producer of dry pet food, sources 85 per cent of its raw materials from within the UK, but some, such as maize and turkey proteins, are not produced in the UK in sufficient volumes and must be sourced from mainland Europe.
IPN’s managing director, Richard Page, said: “We are concerned that in the event of a hard or no deal Brexit, minimal planning has been done to deal with the congestion which is likely to occur at UK ports. This could cause significant disruption to our supply chains and damage an industry which is valued at about £3bn.
“Like many businesses, we operate a just-in-time production schedule with raw materials such as maize only delivered two to three days before it is required. This enables us to achieve production efficiencies and product quality which would be at risk if we were to face supply-chain disruption.”
Brexit threatens to derail the UK’s importing processes. Edward Winterton, CEO, Bibby Financial Services