James Sibley is FSB's Head of International Affairs. James appeared on Times Radio with Digby Jones discussing what small businesses could do to prepare for the end of the UK’s transition period.
Read an excerpt below or listen to the full interview on Times Radio here.
What is the main challenge facing a small business from 1 January 2021?
The main challenge to a small business is their size. If you compare a small business to a large firm, you’re looking at a business that has fewer human resources and less time to spend on preparing for the end of transition. Often they have lower cash flow and cash reserves , and might not have a legal department or an export department. This means many small business owners are handling all areas of their business themselves, including dealing with new regulations.
Are small businesses prepared?
It’s a mixed picture. From our own research at FSB, we know that around a third of businesses feel like they’re prepared for what’s coming. There’s a further third that are still in the process of making adjustments and preparing, but they’re not quite there yet. And the final third don’t know if they’re ready or are concerned that they won’t be prepared.
What key areas should small businesses be thinking about?
It depends on the business, but the main message is there are things you can do to prepare that will be relevant, whatever the scenario. If you’re in goods, for example, it might be registering for an EORI number or contracting the services of a logistics intermediary. Think about the changes that are ahead for your business, and make adjustments when you can.
What can you do if things are out of your control?
There’s a lot that you can’t be 100% prepared for right now - tariffs is a good example. If you already have knowledge of exporting, then hopefully that will transfer. For example, you can’t control the potential disruption at European ports shipping goods to the UK, but you can think about alternative ports and work with your suppliers. You can do what you can to prepare and the rest will come later down the line.
How can small businesses overcome these challenges and uncertainty? Work with your suppliers or your logistics partner. Even if you are limited in resources, or exporting isn’t a major feature of your business, there are still things you can do, such as looking at your business insurance. Our UK transition hub is home to the latest guidance and resources to support you.