Britain’s Small Businesses Aren’t Prepared for Brexit
As the big divorce looms, they have no idea what the rules will be or what they’ll have to do to adapt.
Julianne Ponan doesn’t run a gigantic corporation, but she hasn’t been doing badly. When she bought Creative Nature, based in Surrey, about seven years ago, it was a money-losing maker of candles, among other things. In 2018 the company, which now produces and exports snacks for the booming health-and-wellness market around the world, about doubled its revenue from the year before, to £1.3 million ($1.7 million). The Federation of Small Businesses in the U.K. recognized Ponan with a best retail business award last year for her company’s skill at turning ingredients from as far away as New Zealand into treats, dietary supplements, and cake mixes sold in Britain, Europe, and elsewhere. Ponan found the U.K.—with its banking system and easy access to larger export markets—to be the perfect hub.
With Brexit on the horizon, Creative Nature and hundreds of other small and midsize businesses must deal with an impending quagmire of financial and bureaucratic regulations, the kinds of delays that disrupt cash flow. The divorce from the European Union could cause liquidity problems and lead to innumerable loan defaults that some U.K.-based banks are trying to prevent, small business by small business.