The British Chambers of Commerce, in partnership with moneycorp, surveyed more than 1,000 UK firms to understand the impact of both Covid-19 and Brexit on UK businesses. As Europe still comes to terms with a new post-Brexit landscape, many businesses are now evaluating what the new processes will mean for trade between the UK and the continent.
In the North of England, the survey had 321 respondents, of which almost half (43%) revealed that they have no intention to be active in the EU over the next twelve months. Interestingly, this finding is almost in exact opposition to the UK as a whole, of which 44% expressed an intent to grow their EU exports within the same time frame. The survey also found that a similar percentage of businesses in the North of England have plans for growth outside of the EU (29%) as those with plans for growth inside the EU (24%).
Overall, the report established that more UK firms will be accessing finance in the immediate future, likely due to the impact of lockdown. We found that while the government provided a wave of financial support in the form of business rates, VAT relief and the furlough scheme, around 20% of UK firms we spoke to are still anticipating a reliance on this support in the next 12 months. In the North of England specifically, 41% of businesses do not intend to start or continue to use sources of finance over the next twelve months, while 23% do intend to either begin or continue to use the government’s Bounce Back Loan Scheme. The most popular reason to use finance appears to be for cash flow purposes, though 11% said it would be used for international business expansion.
Due to the uncertainty of both lockdown restrictions and a last minute UK/EU trade agreement, exchange rates have fluctuated significantly over the course of the last year, effecting the value of payments that businesses need to make and balances that they hold. According to our survey, one in five businesses in the North of England admitted that currency risk is more of a concern now than it was two years ago, and of those businesses, the majority (14%) said that while they are aware of their exposure to risk, they don’t do anything to manage it, revealing a crucial blind spot for many businesses. When asked to give a reason for their lack of risk management, almost a quarter put it down to the cost being too high.
That’s where moneycorp comes in. With many UK businesses facing increasing exposure to the volatile currency markets, working with a leading FX specialist as moneycorp can help to shore up finances and protect profits. Our team of dedicated experts are on hand to offer a tailored FX solution that enables your business to navigate the uncertain landscape caused by both Brexit and the pandemic, supporting you in your international trade no matter the scale. Speak with one of our specialists today to find out more.
Image - Andy Dobson (Moneycorp)