Subscribe here to receive ‘Mon Oc’, our monthly eNews (Free of course), and we don’t bother you either !

CLICK ABOVE to Subscribe or Tweet this article – CLICK BELOW to follow us on Twitter . . .

Provence Post Ad for web

Want Not, Waste Not – Recycling and What to do with those really unusual things !

DAILY NEWS FEED . . . Click on picture to read the full article

April 2020
« Feb    

Best value MAPS of FRANCE, and keeping the children amused

Brexit opportunities

by David Anderson

This article is for general information only. Law is a highly specialised area and you should only act or refrain from acting after receiving full professional advice on the facts of your particular case. This article is for general information and does not constitute investment advice. Always consult an IFA.

Brexit is a “disruptive” force for business.

It is unpredictable and the impact on business could be sudden. The main disruption established businesses have had to deal with over the past 15 years have been led by disruptive new comers using the internet and other IT applications. They have transformed industries and brought some big seemingly invincible companies down. Brexit is different because it is a political disrupter and a different mind-set is needed.

Expect the unexpected

Because this is political it can change quickly and will not be linear. IT changes followed a linear trajectory. You could see what was happening in the insurance industry with the internet and knew a similar strategy would soon apply in the travel industry. In this regard the IT disruption was easier to plan for. Brexit is different. Political deals and exemptions could mean one part of the UK banking industry does not have a problem but another part does. What happens in the banking sector may not also happen in the insurance sector.

Real politik normally wins

When the public sees higher prices in shops their attitudes will change. Drops in people’s standards of living will quickly translate into new politics. You cannot predict what will happen but something will, which could impact on your business. What will be decided by our leaders will be completely different to the political dogma endlessly repeated on television.

It’s not just about the UK

What is being said abroad will matters more than what is being said in the UK. It is best to watch what is being said by EU politicians and business people to their home audiences. There will be one thing for UK audiences and another thing for EU audiences.

Think the other way round

Imagine France was leaving the EU instead of the UK. The big opportunity would be for the UK to poach the French food and wine trade. At the top end it has high margins and looks very attractive. How quickly could we in the UK produce cheese and wine of a quality to match French production?  Could a UK business making low margin Cheddar start producing higher margin Camembert? Could we change farming in the south of England to start making Chablis? Would anyone buy English fine cheeses and wines or would it be viewed as a joke? How easily could you recruit people with experience in the high value food and beverage industry to work in England?

French companies would have to set up quickly and probably do joint ventures with English companies. Key French employees moved to England would immediately be targeted to join UK companies keen to move in on this opportunity. A smaller UK based company who understood the cheese and beverage business could take a lot of business from a big French company whose relocation took a long time and went badly. Unhappy French employees relocated from France to the UK with social problems fitting into the UK could mean dismal morale in a relocating company.

It is the same for France trying to poach the UK banking and insurance industry! UK companies setting up banking and insurance operations will face competition from local businesses and UK employees may quickly start thinking about going back to the UK. Problems with spouses unhappy at being in France, children not in the right schools and unsuitable accommodation especially in Paris spell big trouble for any employer. The wellbeing of UK staff relocated to France could make or break the UK business.

Planning scenarios

Big companies have to run through scenarios and plan for Brexit changes. These “war games” are essential and they will devote lots of senior executive time and professional resources to this. Rapid changes are very dangerous for big companies because it takes time to restructure and a major shock could be terminal to even the biggest company. This will mean their eye is taken off running their businesses on a day to day basis.

Smaller businesses run similar risks but restructuring can normally be done much faster. Smaller entrepreneurs should look for Brexit opportunities which bigger companies cannot immediately fulfil. Price moves as a result of tariffs are an obvious example. An example is things which are being imported by a big company suddenly become more expensive because the UK imposes a tariff on them so it is cheaper for a small company to make them in the UK.

December 2016

David Anderson

Sykes Anderson Perry Limited   + 44 203 794 5959


1 comment to Brexit opportunities

Leave a Reply

You can use these HTML tags

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>