R3 survey assesses the impact of Brexit

SMEs

Around 16 per cent of UK businesses have said they have suffered financially as a result of the summer’s EU referendum result.

The survey, conducted by the insolvency trade body R3 and research firm BDRC, found that a majority of firms had yet to report any noticeable change.

But almost one in six – equivalent to around 283,000 firms nationwide – had already started to suffer.

Conversely, there are a small proportion of businesses which believe that the vote for Brexit has actually bolstered their position – with some five per cent arguing that the outcome had improved their finances.

R3 president Andrew Tate said that the immediate shock of the result had been briefer than some had expected and given that the UK is still a member of the EU, the full implications are likely to remain unclear for a while yet.

“When we find out what Brexit actually means, things might begin to change,” he said.

“In the short-term at least, there are likely to be one or two instances of Brexit being used as a bit of a convenient excuse by companies when they run into trouble. That said, Brexit will be causing genuine problems for a significant minority of companies, and it will be benefitting others.

“The main reason for this is the sharp fall in the value of the pound, importers will have been hurt, while exporters may have seen an increase in demand for their products. Uncertainty over the future of the UK-EU relationship may put some important deals on hold, at least temporarily.”

The firms most likely to have faced financial pressures up to this point are those who employ more than 250 staff.

R3 said that larger businesses were generally more likely to bear “the immediate brunt” as they tended to have direct exposure to Europe and are more likely to import materials from overseas.

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