The only thing that has seemed certain in the years since Brexit (the referendum in June 2016), has been uncertainty for people and for businesses.
So where does this leave you if you’re one of Britain’s budding entrepreneurs considering starting a business soon? Should it be all systems go or should you hold fire for the time being?
Brexit: the facts
On 31 January 2020, the UK left the EU and entered a transition period during which it will remain in the single market and abide by the EU’s regulations but without being a part of its political institutions or having any British MEPs sitting in the European Parliament.
From 1 January 2021, the transition period will be over and there will be new rules for doing business, living, working, and traveling in the EU. What those rules are will depend on how the negotiations progress.
Should I be starting a business anytime soon?
The short answer is, yes, why not?
The reality is that despite Boris’ promises to ‘get Brexit done’, we really don’t know how much longer the negotiations will go on for or what a deal might look like or not look like at the end of it. At the moment we’re still stuck in the ‘yelling at each other’ phase (not official political terminology).
If you’re in the throes of just starting a business, or in the research phase, then everything will be new to you anyway. As with setting up a business at any time, you should be aware of the risks and changes that might occur and how these could potentially affect you.
One of the key things you’ll need to do is put together a business plan. This is arguably more important than ever as your business plan should take into account different Brexit scenarios and how this could affect your business operations.
How might my new business be affected by Brexit?
There is a transition questionnaire that you can fill in online to check how to get ready for the new rules in 2021. Pay particular attention from a business perspective if you intend to:
- travel to Europe for business or work there
- employ people from a European country
- exchange personal data with another organisation in Europe
- get EU or UK government funding
- sell products or services to the UK public sector
- rely on intellectual property (IP) protection
- import, export or provide services to the EU or transport goods across EU borders
Opportunities for starting a business around Brexit
Of course, there are many unknowns when it comes to Brexit. However, businesses and startups should be mindful of the potential benefits of Brexit – and how they could take advantage.
New and smaller businesses could benefit by being agile
Adaptability will be key in post-Brexit Britain and will be more difficult for the larger corporations and those with complex supply chains.
You could be at the forefront of the re-emergence of old industries
It’s possible that we could see the re-growth of industries like steel and fishing who suffered when we were part of the EU.
There will be support for British innovation and entrepreneurialism
The government is throwing its weight behind helping smaller companies to start up and grow in niche markets to prove that Brexit will be beneficial for British business.
The strength of the pound
A stronger pound means that imports are cheaper and you’ll get more bang for your buck on holiday but a weaker pound makes UK exports more attractive to foreign buyers.
We can return to buying from world markets
In particular, buying cheaper foods globally outside the Common Agricultural Policy.
2022 will be a big year for Britain
It will be the Queen’s platinum (70th) jubilee, the 75th anniversary of the Edinburgh Festival, the BBC’s centenary, the Commonwealth Games in Birmingham, and (not to forget) the ‘Festival of Brexit’.
Help others prepare for Brexit
In all the uncertainty and with the change that will need to happen in the transition period and when it is over, could you offer services to help people or businesses to get ready?
- Brexit: what accountants should know about life after the transition period
- 3 things accountants should know about Brexit
- Advising your clients on selling to the EU post-Brexit
The content team are the owners of AAT Comment.