To say it’s been a chaotic few months (or years) at Westminster might be seen as an understatement. Nonetheless we are now just over 40 days away from leaving the European Union with a deal, leaving without a deal or agreeing to yet another extension. Although following the recent ‘podiumgate’ and the PM of Luxembourg’s comments, one might be forgiven for thinking that the latter is now off the table.
Added to this is talk of recession, albeit speculatively, within the coming year. In any case most would now consider this to be a question of when, not if.
With this in mind what have you been doing as a business leader to combat these looming challenges?
- Have you clarified the risks and opportunities that Brexit will bring to your Business?
- Have you put in place appropriate measures to combat risk?
- Have you improved operational efficiency and removed all unnecessary costs to assist the passage through potential tough times ahead?
- Have you gotten smarter in respect of product improvement and enhancement together with processes and locations for producing your goods?
- How are you staying ahead of your domestic and European competitors when you may not be able to compete on price and need to differentiate on quality and production efficiency?
- Do you have sufficient staff and with the right skill-sets to work through the next six months?
- Do you think you have a solution for customs arrangements that will change and getting raw material into the UK and finished goods into Europe?
Brexit may close or tighten access to current markets due to custom duties or bureaucracy. It may open doors to other markets. With that in mind, have you realigned your sales force and marketing budget to target opportunities in the domestic market or opportunities emerging from new export markets that you have not yet considered?
It’s been an interesting few months in economic terms. Gross Domestic Product (GDP) grew in Q1 this year as businesses stockpiled in preparation for Brexit. This increased activity and impacted on cash-flow significantly due to increased wage cost, material purchases and increased stock holding. Following the delay, the stock was utilised and production levels reduced resulting in positive cashflow.
We are hearing of businesses deciding not to stockpile as we head to the next deadline. Whilst I’m sure these decisions have not be taken lightly, rationale and planning that is thorough will be required here. Lastly, where is your business in respect of working capital management and having appropriate funding with flexible covenants in place?
Our five-point plan will help determine your future direction and approach that will set you on the strongest possible course by closely scrutinising and advising you on regulation and compliance; financial planning and forecasting; trade; people and talent; and business management.
We’ve also engineered our very own Brexit Stress Index which demonstrates how the market is performing and reacting in real time to market pressures and disruptions. This allows companies to plan in a more informed way.
RSM is happy to meet and assist you in making the right decisions for your business as we progress towards Brexit or appropriately plan for the next extension should it happen.