50% of UK SMEs believe that Brexit has had a negative impact on the UK’s society as a whole and 64% believe that it has had a negative impact on the UK economy, reveals research from FreeAgent, the cloud accounting provider for small businesses and their accountants, launched today.
The new research, which looks at the impact Brexit is having on the UK’s SME sector, reveals that over 1 in 4 (26%) of UK SME owners said that Brexit has had a negative impact on their business. For those impacted, the main consequences cited were:
- Losing Customers – Over half (57%) experienced shrinking customer bases
- Supply Chain Issues – 43% were impacted by supply chain issues and found it harder to get cost effective supplies or produce for their business
- Increased costs of goods – 2 in 5 (42%) of SMEs found costs had increased to import goods
- Talent Shortage – 16% are suffering from a talent shortage as they are finding it harder to recruit staff
How do SME owners feel about Brexit?
- Shutting Up Shop – Nearly 1 in 5 SMEs (19%) have considered closing their business during Brexit and 1 in 5 also did not think their business would survive Brexit
- Uncertain future – Even now, nearly half (46%) of SME business owners are worried about the future of their business. This worry increases for younger business owners, with 57% of 18-34 year old SME owners concerned about the future of their business
- Unfairly impacted the SME Sector – Over half (54%) believe that Brexit has a greater negative impact on SMEs than it had on large businesses
- A Divided Nation – 68% of SME owners believe that Brexit has led to a more divided United Kingdom.
- SME owners are more likely to agree with this statement if they also said that Brexit had a negative impact on the UK economy and the society as a whole where it rises to 79% and 85% respectively). This is also the case for SME owners who are worried about the future of their business (81%).
Roan Lavery, CEO and co-founder of FreeAgent said, “Without doubt, Brexit has had a drastic impact on all businesses – large or small. However, the research emphasises how the challenges presented by Brexit are now being felt more so by UK SMEs. Leaving the EU has presented significant bottlenecks to the survival of these businesses including both supply chain issues, increased red tape and higher costs.
“The onus rests on the government to support these businesses, which make a significant contribution to the wider economy. Many SMEs are still tackling uncertain times as we as a society emerge from a pandemic stricken world. In light of this and the concerns expressed by SME businesses in this research, government support is clearly still needed to put these worries at bay.”