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Preparing your business for disruption

6th February, 2019

Most UK small firms are ‘unprepared’ for any form of business disruption, according to research recently published by the Federation of Small Businesses (FSB). With both Brexit and Making Tax Digital looming it’s more important than ever that businesses take steps to ensure they are able to be agile and adaptable. Nottingham chartered accountants Clayton & Brewill, provides some tips on preparing your business for disruption.

Preparing your business for disruptionThe FSB suggests that a variety of internal and external threats could significantly rock the boat for many small UK firms. Some of the most common risks to businesses include customers failing to pay for goods or services, and the loss of key members of staff. However, a number of other risks are identified, such as IT problems, cybercrime, severe weather, transport issues, and even terrorism.

At present, some 65% of small businesses don’t have any plans in place to deal with disruption to the operation of their business or to their supply chains. Clearly, it’s an area with which businesses looking to plan for a post-Brexit future will have to engage as a matter of priority.

A ’no deal’ Brexit

As a ‘no deal’ Brexit inches closer, the CBI warn that the impacts of a no deal will be vast and will impact every region in the UK. Their interactive map shows the business and economic impacts of a ‘no deal’ Brexit in each region of the UK.

The CBI suggests that the manufacturing industry, which is the East Midlands’ largest sector, would be particularly exposed to the risk of rising tariffs and other trade costs if we were to face a ‘no deal’ Brexit. Agri-food businesses, which makes up a large part of the East Midlands manufacturing sector are likely to be particularly impacted by rising costs.

Those who export goods are also likely to face difficulties trading with the EU, along with increased costs.

Making Tax Digital

Accountancy Age recently reported that only 57% of businesses who must comply are ready for the forthcoming Making Tax Digital deadline.

Businesses who are VAT registered and have a taxable turnover above the VAT threshold – currently £85,000 – must be ready for Making Tax Digital by 1 April 2019.

Whilst there is a soft landing period of a year, during which firms will not be fined if they don’t comply in time, it’s important that business get themselves prepared to ensure they are able to provide digital records to HMRC.

Our Making Tax Digital resources provide useful guidance on how you can get prepared.

Tips for preparing your business for disruption

In order to minimise the impacts of any disruptions, it’s important that businesses plan ahead and consider how they would deal with any issues they may face. Thinking strategically is key. Things to consider include:

  • Scenario planning – consider all the risks that your business could face and the potential impacts.
  • Seek advice from trusted professional advisers – your advisers are likely to have a good understanding of your business and other businesses similar to yours and can help you to plan ahead and get prepared.
  • Use reliable resources – when considering what is likely to impact your business it’s vital reliable sources. Official websites such as Gov.uk are a good place to ensure you are accessing the key facts. Their ‘How to prepare if the UK leaves the EU with no deal’ collection provides some useful information for those planning for Brexit.
  • Develop continuity plans – continuity plans allow you to respond to issues efficiently and effectively. For example, those businesses who are likely to encounter supply chain difficulties, should identify the most significant risks to their commercial operations and create a plan to mitigate those risks should they materialise.

Above all, taking a proactive approach to ensuring you’re aware and prepared for potential business disruption is the key to being able to respond effectively and efficiently, and ultimately allowing your business to be resilient.

Clayton & Brewill can provide advice and guidance to help you plan ahead. Contact us to find out more about how we can help you and your business. 

 

 

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