Is your business prepared for the risk of a no-deal Brexit?

28 October 2020

The UK officially left the European Union on the 31st January 2020 and entered into a ‘transition period’. The UK and the European Union have until December the 31st to agree a new relationship. 

With 66 days to go recent negotiations have stalled. As a result, the UK government have ramped up their no-deal preparations, encouraging British business to get ready for Brexit. Failing to prepare for new legislation and controls as we leave on the 31st of December without a deal is likely to have a significant negative impact on your business operations.

What could happen if you fail to recognise the risks;

  • Potential loss of market share as your competitors successfully plan for Brexit and navigate the risks.
  • Reduced income as your supply chain is negatively impacted, as you attempt to come up to speed with new regulations and border controls.
  • Growth plans on hold as the impact of no-deal Brexit is far greater than you expected.

To safely navigate the uncertain times ahead it’s imperative that you assess the potential risks Brexit will have on your business, and importantly put a plan in place to mitigate these risks if they ever arise.

So, what are the possible risks of a no deal Brexit on your business?

The Risks

Interruption of your supply chain with possible queues at the border

Insurance will be required as International Health Insurance Cards will no longer be accepted

Unable to source items / raw materials as required

No agreement on aviation and transport links

Shortages of food coming in from Europe

Extra bureaucracy and time when dealing with customers / suppliers in Europe

Increased measures to be taken for staff travel to Europe

The impact on the export of your products / services to Europe

International driving permits and green cards to take a car to Europe

 

What action have you taken and what plans do you have in place to mitigate these risks?

Long-term Brexit is likely to have a bigger impact on your business than Covid-19. Yet, many businesses have not addressed the Brexit question – blindsided by managing the immediate problem facing their business. With 10 weeks to go, it’s now essential you start review and assess the risks of Brexit.

Important questions you need to address;

  • Have you reviewed your risk register? – Risks are not static, the impact they can pose to your business can change over time, both positively and negatively.  Reviewing your register regularly ensures you are focusing business time, effort and resources appropriately.
  • Have you captured all your possible risks? -  Missing a key risk could have a material impact on your business realising your strategic objectives and in turn your business goals.
  • Are they correctly prioritised?  - This should be done to ensure resources are allocated to mitigating the key risks, that have the potential to be the biggest risk to your business.
  • Have you got the relevant controls in place to help to mitigate these risks? – Controls can treat the risk or transfer it, in the form of insurance. 
  • Have the controls been tested? – A periodic review should take place to ensure a) the control is happening b) performing the control is giving the expected output c) if it is not, action has been taken and the risk score is reviewed as a result.
  • Have you got Key Performance Indicators in place to help monitor the risks? – This gives your business comfort that you are on track to achieve your strategic objectives.

The benefits of seeking help and having a robust Business Continuity Plan

Has your Business Continuity Plan been tested in the last 12 months? – Your business, and the economic climate that you operate in can change significantly in a year. It is therefore important your revisit your continuity plan regularly, to ensure it is fit for purpose and would work in the event of an incident occurring.

What could a risk review do for my business?

  • Potentially it may save your business money
  • Help to safeguard your business from imminent risks  
  • Help to improve the efficiency of the business
  • Give you comfort that the business is performing as you think it is
  • Provide you with a competitive advantage, that your competitors simply haven’t thought of!

Contact our Risk Management team for further details on how we can help your business Contact

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