Number of businesses unprepared for no-deal Brexit “a worry”

InterTradeIreland’s latest all-Island Business Monitor (Q2 2019) reveals the business environment remains resilient, with 40% of companies across the island reporting growth.

Optimism for the year ahead is however in short supply, with the number of businesses expecting an increase in growth over the next 12 months down to 2009 levels.

Dealing with Brexit is by far the biggest cause of this uncertain outlook. 45% of businesses overall, and almost 60% of manufacturing firms, record Brexit as the key issue they face.

Worryingly, however, despite a range of support services, only 11% of respondents say they have made any preparations in the event of a ‘no-deal ’ Brexit.

In terms of getting ready for a no-deal outcome, bigger firms with more capacity are better prepared with 35% saying they have made preparations. At the other extreme, only 1 in 10 micro businesses has made any preparations.

Tellingly, 82% of cross-border traders, who are most exposed in the event of a no-deal, have not prepared for that outcome. Indeed, only 14% of businesses trading cross-border have examined the impact of customs, while just 12% have looked at the effect of tariffs.

Aidan Gough, InterTradeIreland’s Designated Officer and Director of Strategy and Policy, said: “The disparity between businesses recognising Brexit as the key issue facing them and the number actually preparing for it remains a worry. While we appreciate the uncertainty facing businesses and the constant challenge to win new and service existing orders, we nevertheless implore firms, particularly those that trade across the border, to make themselves aware of the issues that Brexit could pose for their operations and to explore mitigating options.

“There is a range of supports out there for businesses, including InterTradeIreland’s Brexit on-line learning resources and funding of up to £4,500/ €5,000 to help with expert advice. “Don’t leave it until the last minute. There are lots of small steps that businesses can begin to take now to prepare, whatever the outcome. It doesn’t have to be onerous. Planning is never wasted and is much preferable to panic if left undone.

“While Brexit remains the overwhelming issue facing businesses, particularly small businesses, there is a concern that failure to remove the uncertainty is exposing businesses to more problems in the longer term. As the pace of technological change advances at a rate that leads many commentators to refer to a new industrial revolution (Industry 4.0), the latest Business Monitor finds only around a fifth of businesses on the island have heard of the fourth industrial revolution, with even less being aware of its possible implications which for many industries and businesses could be profound.”