One of the more worrying aspects of waking up to the news that Britain had voted to leave the European Union was the uncertainty. What was going to happen to the industry? How soon would our businesses feel the effects, if at all? What can be done to counteract any potentially negative impact on UK SMEs?

Months on, as the fog of the unknown gradually starts to lift, a clearer picture is beginning to emerge, albeit at a sluggish pace. It is very early days, with article 50 yet to be triggered, but as of yet the impact on SMEs appears to be minimal, according to the Business Barometer, a quarterly survey from Close Brothers Asset Finance.

56 percent of SMEs surveyed reported no change in business levels following the referendum, result, with a further 24 percent telling the Business Barometer that Brexit had had a direct effect on their company. 20 percent felt it was too early to tell what the repercussions may be.

The report broke down the attitudes and perspectives regionally, finding that businesses in Greater London feel especially affected; 46 percent answered ‘yes’ when asked if they had seen an impact on business caused by Britain’s decision to leave the EU, while 38 percent reported they had not.

Neil Davies, chief executive officer of Close Brothers Asset Finance, explains: “It’s clear that the majority of UK SMEs are yet to feel any real and tangible effect from Brexit.

“It’s interesting to note that of those who have been impacted, it’s pretty much split down the middle in terms of those who have been positively and detrimentally affected. There is also a real regional difference, with businesses in London feeling the most exposed.”

Unsurprisingly, SMEs in the Greater London region were also the most likely to delay spending in the wake of the Brexit decision, as 48 percent revealed that it was directly responsible for a deferment in investment, while in East Anglia, Wales, and Northern Ireland, the overwhelming majority of businesses answered ‘no’ when asked if the referendum directly impacted any decision to delay spending.

Davies continues: “It’s interesting to note that 88 percent of smaller firms – those with a turnover of between £250k to £500k - were the least liable to allow the EU referendum stop them from pushing their business forward. Close Brothers has a history of lending through all economic cycles, and experience tells us that these organisations aren’t sitting on large reserves of cash. In order to maintain business levels, they typically don’t have a choice but to spend and invest to ensure a sustainable flow of cash.
 
“Firms don’t become unviable overnight; we see it as our responsibility to do what we can to ensure our customers, who are in the main SMEs, remain in business and can build towards a profitable future.”
 
In terms of looking to the future, just 18 percent felt that there will be fewer opportunities as a result of Brexit, with the majority predicting no change in the status quo because of the decision to leave the EU. “Greater London companies are the most positive region we surveyed,” Davies concludes, adding: “53 percent expect more opportunities while 48 percent of engineering firms are equally as positive.”    

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