Brexit – stay or go?

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As a small business assisting other small businesses exporting we are often asked our position on the EU referendum. This is a staggeringly broad subject – and we confine our view purely to the process of export order fulfilment.

In short our view is to remain. When it comes to trade, a key tenet of the argument to leave is that we will be better positioned to negotiate better trade terms, i.e. duties, tariffs and non-tariff barriers like standards and regulations, which will result (somehow) in increased exports of goods for SMEs. However, against a backdrop of a rising protectionism worldwide (1) – favourable bilateral agreements, or that improved WTO rules or EEA status will prevail is hard to believe (2).

The root cause of the UK SME export rut is not the EU. The UK is already one of the least regulated product markets in the OECD (3) and key barriers to export such as fluctuating exchange rates and red tape will most probably be less than optimal after an exit.

Moving out of the domestic market comfort zone to operate in foreign markets is key. SMEs segments in other EU countries fare better but copying their approach is not necessarily the answer (4). Instead, small businesses should take heart – our strengths are quality, service and price – frequently cited as reasons to do business by our customers (5).

On the EU, we must work with, influence and lobby EU entities to make it work better for us. Mechanisms for achieving these aims already exist – the EU Small Business Act being one. The bodies that administer these should be held accountable and deliver. So much of what’s good for EU small businesses is also good for UK small businesses.

SMEs perceive that corporates, who favour the EU, have an unfair advantage – we agree. Our view is that there is a lack of tooling aimed at SMEs for levelling this playing field – particularly in export processes. At Parkway Logic we are developing tools to assist SMEs simplify their export journey – Exabler.com is our tool to expedite the fulfilment of first time and regular export orders.

  1. http://www.globaltradealert.org/gta-analysis/tide-turns-trade-protectionism-and-slowing-global-growth
  2. https://www.global-counsel.co.uk/analysis/special-report/brexit-impact-uk-and-eu
  3. http://www.oecd.org/economy/pmr
  4. http://www.economist.com/news/business/21606834-many-countries-want-mittelstand-germanys-it-not-so-easy-copy-german-lessons
  5. http://blogs.fco.gov.uk/leighturner/2015/08/18/why-british-manufacturing-is-so-competitive/

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