"Unless importing rises higher up the Government agenda, the survival of SMEs could be put at risk."
Research from Bibby Financial Services found that a third of the 1.1 million UK SMEs with EU suppliers would be unable to operate without imports from the bloc and 61% would expect profits to fall if they could no longer access the EU single market.
More than half (55%) of businesses would also struggle to find alternative suppliers outside of the EU.
In addition, recent research by the British Chamber of Commerce and BFS found that almost two-thirds (62%) of UK SMEs have not done a risk assessment on the impact Brexit could have on their business.
Although SMEs started the year with a rebound in confidence as a result of progressive negotiations with the European Union, the latest figures also suggest that ambiguity surrounding Brexit is dampening their spirits, with the UK’s uncertain economic environment overtaking rising costs as the most significant barrier to investment in Q3. As a result, confidence has dipped for the second consecutive quarter, from 61.4 in Q2 to 60.8 in Q3 2018.
Edward Winterton, UK CEO of Bibby Financial Services, 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.
“We started the year with a degree of cautious optimism, but since then confidence has plummeted as Brexit negotiations have stalled. Unless significant progress is made this month, this is likely to remain the case.
“It’s been said countless times, but SMEs need clarity on what the future trading environment will look like post-Brexit so that they can prepare and focus their efforts on business survival and growth.”
