Deal or no deal? How businesses trading with EU countries should prepare for Brexit

no deal brexit

With Britain’s departure date from the European Union fast approaching and Theresa May’s Brexit deal yet to be passed, businesses are being warned to prepare for a no deal situation. But what does this mean for businesses trading with the EU?

HMRC is advising businesses dealing with EU countries to take three steps now ahead of the Brexit implantation date on March 29

1. Register an EORI number:

Every business in the UK which currently exports goods outside the EU or imports goods from outside the EU should have an Economic Operator Registration and Identification (EORI) number. EORI is a 3-digital addition to a VAT registration number and was introduced a few years ago to speed up the passing and recording of customs export declarations.

Following Brexit, goods exported or imported from the EU, will be treated in the same way as goods departing or arriving from the rest of the world, so if businesses haven’t already got an EORI number then they need to get one.

The government’s position is that if the ‘deal agreed’ with the 27 other EU countries is passed by Parliament, broadly there will be no change in the way trade is conducted and reported between the UK and those 27 countries until 31 December 2020. But don’t assume a deal will pass parliament, or wait until the last minute to act. Registering could help your business avoid significant disruption so be sure to act now.

2. Appoint a customs agent or invest in software:

Companies need decide whether they will use a customs agent to make import and/or export declarations. If they want to make the declarations themselves, they will have to get specialist software to do this.

3. Contact your haulage firm or transport organiser:

Get in touch with the organisation that transports their goods (e.g. a haulage firm) to find out if they need to supply additional information to complete safety and security declarations, or whether they will need to submit these declarations themselves. Businesses already importing or exporting goods with countries outside the EU should already be aware (either directly or via their import or export agent) that the existing CHIEF (Customs Handling of Import and Export Freight) system is currently being replaced in phases by a new customs declaration service (called Customs Declaration Service or CDS). This is expected to be fully operational by end of March 2019.

For further information about exporting and importing, contact Pierce on 01254 688 100.

 

The Top 10 Action Points for Business Owners Post the Brexit Decision.

John Green 1 web

John Green, Director and Chairman of Pierce Advisory and Accountancy Group outlines 10 key points for businesses to action so they can thrive post Brexit.

At times of such unprecedented political and economic upheaval it’s very difficult to assess what will happen next.  Significant uncertainties are likely to remain for some time and with the Government indicating that no important decisions will be taken in the short term there is a need for local business owners to focus on what they can control.

The reality is that the majority of such businesses are in good shape and as such a strong case exists for approaching Brexit positively (regardless of initial views) and seeking out new growth opportunities.  These will, of course, vary dependent on the individual business but to do nothing is not an option, and certainly would leave the business exposed to future headwinds.

The following 10 point plan covers the main areas relevant to any business looking to grow and is a useful check list for the local business owner.

  1. Consider Acquisition Opportunities. Details around the timing of a formal Brexit will likely be unknown for some time; we anticipate prospective business vendors adopting a realistic stance to company valuations over this period, and with lenders advising that they remain committed to supporting such deals, now could be the time to consider growth by acquisition.
  2. Review your Capital Investment Strategy. Fundamentals for investing in new premises or plant and equipment remain unchanged, and with a strong order book and finance available this could support your growth strategy.  To delay, may result in the loss of potential new business.
  3. Explore the possibility of entering, or expanding into, new Export Markets. The recent reduction in the sterling exchange rate (particularly in those markets making payment in $’s) makes UK products and services more competitive. With support available in this area via the local Chambers of Commerce and UKTI, your business could benefit from an opportunity like this.
  4. Review your Recruitment Policy. As other businesses delay, or potentially downsize, is your Recruitment Policy still appropriate?  Is there an opportunity to take advantage in the short term by recruiting high quality staff with the appropriate qualifications for your business?
  5. Is now the time to set up or expand your Apprenticeship Programme?  Government support is currently available in this area, and with school exam results out shortly there is likely to be a good number of capable and enthusiastic school leavers entering the job market.
  6. Take advantage of the Grant Availability. If you are planning to expand, then significant grants are currently available, however many of these are linked to European initiatives and job creation.  Over the coming years prior to formal Brexit, the terms attaching to these may change or they may be withdrawn altogether. Whilst the Government is likely to seek to replace these in some way there could be delays so it makes sense to act now.
  7. Improve the Liquidity within your business.  Clearly this can be a challenge but if your business is able to build a cash reserve, or similar, it will leave you very well placed to take swift advantage of purchasing stock at advantageous prices or taking early settlement discounts etc. should these emerge.
  8. Update your Business Plan to reflect the above. Your plan should incorporate your revised budgets and latest actual monthly management accounts.
  9. Maintain a regular dialogue with your Bank. Over the upcoming months, apprise them fully of your plans and seek confirmation of existing funding lines and reassurance on their ongoing commitment to support your growth ambitions.
  10. And finally, ensure your Staff remain aware of your confidence in the business and future growth plans.  As your ‘most valuable business asset’ it’s essential that your team are fully engaged, particularly in times of uncertainty, and buy in to your positive vision of the future.

At Pierce, our award winning Corporate Finance team would welcome the opportunity to talk further with businesses regarding their plans as we can help you realise your ambitions.

For more information about Pierce, call 01254 688 100.