The Trade and Co-operation Agreement (TCA) between the UK and EU in the wake of Brexit is delivering more headaches than benefits for the majority of exporting SMEs.
That’s according to data collected in December last year by the British Chambers of Commerce from almost 1,200 surveyed businesses.
The survey found that almost eight in 10 firms had found the Brexit deal was not helpful in their drive to increase sales or grow their business overall, whilst more than half continue to face difficulties adapting to the new rules for trading goods.
Download now: 7 key changes to UK-EU trade post-Brexit
Meanwhile, 45% of service businesses said they’re still trying to adapt, whilst over four in 10 said they’re finding it difficult to obtain visas for new staff.
These difficulties are directly translating into business performance too.
The survey also found that 80% of firms are seeing the cost of importing increase, whilst more than half have seen their margins cut. Three-quarters of manufacturers also said they’d had issues with shortages too.
“Simple importing of parts to fix broken machines or raw materials from the EU have become a major time-consuming nightmare for small businesses, and Brexit-related logistics delays are a massive cost when machines are stood waiting for parts. We used to export lesser amounts to the EU, but the bureaucracy makes it no longer worthwhile.”
To help alleviate some of the issues UK businesses are facing, the British Chamber suggested five fixes that the government should look to introduce:
- Create a supplementary deal with the EU that either eliminates or reduces the complexity of exporting food for SMEs.
- Establish a supplementary deal, like Norway’s, that exempts smaller firms from the requirement to have a fiscal representative for VAT in the EU
- Allow CE-marked goods and components to continue to be used in Great Britain after 2024.
- Make side deals with the EU and member states to allow UK firms to travel for longer and work in Europe.
- Reach an agreement on the future of the Protocol on Ireland/Northern Ireland with the European Commission in the early months of 2023, to stabilise our trading relationship.
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