As Theresa May confirms she will trigger Article 50 on 29 March, new research by the Federation of Small Businesses (FSB) highlights small business priorities.
Unsurprisingly, a trade deal with Europe remains a top priority for well over half of small businesses (63 per cent), closely followed by the US, Australia and China. Despite 92 per cent of exporting small businesses trading with the EU, the majority also do business outside of the single market.
The report, entitled “Keep Trade Easy: What Small Firms want from Brexit” published on 21 March, shows that, where cost is concerned, almost half of current exporters and over half of current importers find trading with the EU single market cheaper than trading with non-EU markets. While only nine and eight per cent, respectively, find it more expensive.
A real concern for small businesses trading overseas, is impact of potential tariffs and non-tariff barriers to trade with the EU. One in four exporting small firms would be genuinely deterred from trading with the EU should any tariff, not matter how low, be introduced.
The publication of FSB’s research follows last week’s statement to the Brexit Committee by Brexit Secretary, David Davis MP, confirming that the UK Government has not assessed the impact of leaving the EU without a deal, since the 21 June vote.
FSB chair, Mike Cherry, comments: “Small firms trade with countries based on ease, cost and value and any future trade deal must deliver on these key aspects both with the EU single market and non-EU markets.
“The reality is that the EU single market is still a crucial market for smaller firms and cannot be undervalued. Compared to larger companies, small businesses typically work to tighter margins with limited resources, meaning changes to the trading landscape will hit them disproportionately hard. We call on the government to ensure that a sensible phased implementation arrangement is put in place to avoid a cliff edge, once we have left the EU.”