Are you Brexit Ready?
The risk of a hard Brexit remains a strong possibility as the UK Government ramps up plans for exiting the EU.
While Brexit will impact businesses differently, it is likely to result in increased costs and additional working capital requirements for all, whether you are a primary producer; a business trading directly with the UK; a business transiting the UK; or indirectly, those further along the supply chain.
Whether you have a direct exposure to the UK or not, we would encourage you to take the following steps:
Step 1: Establish how your business will be impacted by Brexit
Seek professional advice on how your business will be impacted by Brexit and put a plan in place to protect your business. There are a range of supports available from your Local Enterprise Office, Enterprise Ireland, Bord Bia, InterTrade Ireland and AIB Brexit Advisors that you should consider. If you are trading directly with the UK or using the UK as a land-bridge you should engage directly with the Revenue Commission to establish the steps you will need to take to become customs-ready.
Step 2: Consider the impact on your cash flow
Due to the increased cost of trading with the UK and the knock on supply-chain impact, Brexit may affect the cash flow of your business so you should consider how this will impact your working capital requirements. Talk to your bank about the different finance options available.
Step 3: Review your foreign exchange exposure
If you are trading in sterling, the exchange rate volatility could also impact your margins. Again, talk to your bank to discuss different options to mitigate your foreign exchange risk. This will help protect your revenue and provide greater cost certainty.
At AIB, we are actively encouraging our SME customers to plan for a hard Brexit scenario and to consider the impact it may have on your working capital in particular. We would also encourage you to be proactive and discuss your business plans and financial requirements with your bank at an early stage. For further information on becoming Brexit ready click here.
Please be aware that all of the views expressed in this Blog are purely the personal views of the authors and commentators (including those working for AIB as members of the AIB website team or in any other capacity) and are based on their personal experiences and knowledge at the time of writing.
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