24 Oct 2017 | 11.19 am
Brexit Borders: Now Is The Time For Business Preparation
InterTradeIreland on call for firms trading across the border
24 Oct 2017 | 11.19 am
Small business are disproportionately reliant on cross-border trade. Now is the time to plan for changes that Brexit will bring to this landscape, says Aidan Gough (pictured), Director of Strategy & Policy, InterTradeIreland
In the space of one month, 177,000 lorries, 205,000 vans and more than 1.8m cars will cross the border between Ireland and Northern Ireland. In one day, it is estimated that 30,000 people make the cross-border commute to work.
These lorries, vans, cars and people are involved in a trade in goods and services that now totals close to €6bn a year, growing at an average annual rate over the past 20 years at over 4%.
This trade across the border is disproportionately important for small business. The reality of this ‘frictionless’ land border for many small businesses is that the all-island market is effectively their local market despite it being cross-border — a notion that is unfamiliar to many small businesses in Great Britain.
Ensuring that businesses continue to avail of these growth opportunities, which also extend to value-enhancing research, development and innovation partnerships, is a key challenge for InterTradeIreland, the cross-border trade and business development body set up by the Belfast/Good Friday Agreement.
Through its quarterly All-Island Business Monitor, InterTradeIreland has been monitoring the response from the business community across the island to the UK’s decision to leave the EU since it was taken on June 23 last year. One of the most alarming pieces of information from this survey is that when asked about making plans to deal with the post-Brexit world, 98% continue to say they have none in place.
The lack of planning is driven by two key issues, the first of which is an understandable focus on ‘the now’. In what is already an intensely competitive market environment for small businesses across the island of Ireland (a fact borne out by respondents to InterTradeIreland’s All-Island Business Monitor, who are facing the challenges of rising costs of energy, supply costs and overheads, new competition and difficulties recruiting appropriate skills), finding the time and resources to plan for even potentially significant structural changes is a perennial problem.
The second issue is the degree of uncertainty that abounds due to a perceived deficit in reliable information, which complicates and constrains the scenario building process. Over the past six months, InterTradeIreland has been out and about, speaking at events on both sides of the border, encouraging businesses to prepare for a new cross-border trading relationship while listening to their concerns.
This engagement, backed up with information received in our all-island Business Monitor and several in-depth case studies, has helped us develop and launch a new Brexit Advisory Service for potential and current cross-border traders.
The service includes direct access to specialist technical advice in areas such as tariff and non-tariff barriers, rules of origin, certification, staffing, exchange management and logistics, through Brexit Readiness Vouchers to the value of €1000, as well as specific guidance on tariffs at detailed product level. It is built on the mantra of encouraging businesses to PLAN, ACT and ENGAGE.
Planning can begin with basic questions around the freedom of movement of goods, services, people and how that impacts a business. For example: What might the impact be of tariffs or non-tariff barriers? What is the scale potential tariff that could be levied on my products? Do I know what rules of origin certificates are and what they cost?
When the business answers these questions, and InterTradeIreland’s new service can help with this process, the next step is to act, or at least to prepare alternative scenarios and actions depending on what emerges from the negotiations.
Innovation, the application of lean techniques and diversification are just some options to build higher margins within a business model. Support is available from InterTradeIreland and other industrial development support agencies to assist in all these areas.
Critically, we are encouraging business owners to engage widely throughout the Brexit process. Talk with industry representative bodies, with industrial support agencies like InterTradeIreland, lenders, your workforce, customers and suppliers. Policy makers are also intensely interested in direct feedback from the business community to inform negotiating stances.
InterTradeIreland’s message is simple. While we recognise the pressures facing small business owners dealing with the here and now, there is, nevertheless, a window of opportunity now that must be grasped to prepare for the challenges and indeed the opportunities that will be presented by a new cross-border trading relationship that is set to emerge over the next few years.
For more information, visit www.intertradeireland.com/brexit/