How should you prepare your finances with Brexit in mind?
Ever since Britain voted to leave the EU back in 2016, we’ve all been sat on the political rollercoaster – and so have businesses too. For a finance team that has European staff and/or supply chains, though, there’s even more to think about. According to the Confederation of Business Industry (CBI), only 57% of firms surveyed have gone through Brexit scenarios and thought about how they might play out – but as a finance leader, you simply can’t take the risk of being in the other 43%. So here’s how to prepare…
1. Get on top of your supply chain management
First of all, any business with a supply chain that’s connected to Europe (i.e. most) should take particular measures. Whether you run a pharmaceutical firm and need to import medicines or you have a crucial raw ingredient that usually enters the UK via Dover, topping up the company's cash reserves is essential. You may have to pay for another, a more expedited form of delivery, for example, or buy domestically at a higher cost for a while.
2. Make sure your 'rights for staff' is in line with current regulations
While at the moment it appears that most rights currently enjoyed by European nationals will be protected (at least temporarily) once Britain leaves the EU, it’s not clear what the situation will look like in the longer term. If your finance team contains EU nationals, then thinking ahead and ensuring that you’re able to cover their work in the event of resignation due to their decision to relocate is wise.
Yes, it may be wise to prepare for the possibility of higher staff turnover. In the event that EU nationals find that their rights are not protected after the transition period ends, it’s perfectly possible that there’ll be a wave of migration away from the UK. In that case, your business should prepare to pay for management time lost to spending time on new hiring processes, an increase in onboarding costs such as training, and more.
3. Be prepared for unforeseen expenses
Perhaps the one major hallmark of the last few years of Brexit chaos has been the uncertainty that has been thrown up by the development. From a finance point of view, this could well mean higher expenses: the C-Suite might have to fly to Paris or Frankfurt at short notice, say. Finance leaders should act now to make sure that they are able to keep track. By investing upfront in a centralised system that allows you to see dynamic and customisable data on expense reports, you’ll be in a better position to assess whether expenses have increased. Make sure that you are in the 2.2% of finance leaders who AccountingWEB found prioritised strategic thinking: plan ahead, and think long-term.
Whether Brexit happens in March or whether an Article 50 extension means that it happens later, it’s definitely wise to keep your finances prepared. From ensuring that your supply chain has a buffer of cash around it to being prepared for a potential surge in expense reports, there are lots of ways to get those finances ship-shape ahead of Brexit.
Streamlining and gaining further insight into your staff expenses isn’t just a job for the Brexit-age though. Find out more about how Access Expense is the only expense management tool you’ll ever need.
