Boris Johnson is pledging to get Britain ready for a hard exit from the EU, but small businesses are doing little to prepare.
When a potential cliff-edge Brexit loomed last spring, Albion Stone Plc stockpiled equipment and materials as a precaution against disruptions. Not this time around.
Michael Poultney, the business director at the Redhill, England-based firm, is still smarting after spending more than 200,000 pounds ($240,000) on preparations, only to see Britain’s exit from the European Union pushed back to Oct. 31, or perhaps further.
“I don’t think it’s worth me wasting another 200,000 pounds, buying in stock, on the very slim possibility there could be a no-deal Brexit,” Poultney said in an interview. The company, which mines limestone in Dorset, buys saws and tools from Italy and carries out stonework projects in the EU.
Poultney isn’t alone in his laissez-faire approach: about 80% of Britain’s small firms are unprepared for a disruptive divorce from the EU in October, according to the Confederation of British Industry. Small and mid-sized enterprises employ some 16.3 million people in the U.K., or 60% of private sector staffing, and generate 2 trillion pounds in annual revenue, government figures show.
Their lack of preparation leaves the U.K. particularly vulnerable to an economic shock, said Nicole Sykes, head of EU negotiations at the CBI, the country’s biggest business lobby group.
“It’s a huge problem,” she said. “If you’re trading goods and you haven’t filled out the right forms, you may get turned away at the border or your goods might get impounded.”