When it comes to business, prepare for the unexpected
PUBLISHED: 15:54 30 October 2018 | UPDATED: 15:54 30 October 2018
Keep calm and carry on? Don't think so. Simon Birks of Sherbornes urges businesses to prepare for the unexpected
Plan for the worst and it might never happen.
“Prior Preparation Prevents Politically-Perpetrated Poor Performance”. Okay, so it’s not quite the saying that we’ve all heard before.
With the “B” word now as prevalent as the Millennium Bug was at the close of the 1990s, many people are, and more people should, be thinking “what can I do now to prepare for the unknown?”
Unlike the Millennium Bug however, Brexit will most certainly not result in a situation where everyone looks back in a few years and says: “I don’t know what all the fuss was about – everything carried on as normal”.
Things will change, your cheese, be it French, Italian, Dutch or whatever, will be moved and whether or not you like it, it will happen.
As with every change that comes, threats and weaknesses will be exploited, but so too will opportunities arise and strengths be amplified. So now is the time to act. Armed with the knowledge of change, prepare for this in a way that causes no real harm if things don’t change as much as you anticipate.
Business owners will have read and seen the debates about how the UK’s stance on free movement of people will affect EU nationals presently working in the UK and, critically, those who would otherwise have migrated into the UK seeking employment. As we all know from the rhetoric, these are typically in areas and industries where UK nationals would prefer not to earn a living.
Those business owners should also be analysing their own businesses and assessing which parts of it are “Brexit vulnerable” and which will thrive in an era of imposed restrictions on EU trade.
So what can be done?
Taking simple steps now may mean that your business is at the front of the stampede for staffing when it comes to replacing turnover and encouraging recruitment and retention in a post EU climate. For example, there may be a rush for staff who could, after all, be a scarce commodity. So why not do away with those zero hours contracts which only serve at a stigma for your business and which do not, and have never really, afforded a business with the protection that many people believe they do? It would help to attract domestic labour.
Why not consider exploring apprenticeships as a means of ensuring that the knowledge and experience of your workforce is passed onto future generations and thus avoid the need to buy in expensive and hard to come by talent?
And there’s a whole host of staff retention and loyalty schemes out there from bonus and share option schemes, to very simple measures like allowing staff to bring their dog into work – all of which help to retain the staff that you have now and which others will be desperate to poach from you.
Business owners may also consider restructuring their businesses to separate assets (such as the freehold building from which the business operates) from the trading parts of the business and thus protect those very assets from any downturn. Aligned to this is the separation of different divisions or product lines in the business, again to protect the safe from the effects of the vulnerable.
Whether or not you decide to act, this decision should be taken with as much information as possible on the likely effects of Brexit; so keep up to date with developments, arm yourself with the latest thinking, attend updates and seminars (such as the one held by Sherbornes in February 2019!) and at least have some degree of certainty as to what it is most likely to mean for you and those who are dependent upon you for their living.
The measures above are just a few of the simple ones that we are coming across in our daily discussions with our clients. They should be considered, as few of these measures, if any, come at a substantial cost. Furthermore, none of these should adversely affect a business if, for some miraculous reason, we all decide that we were having an “off day” on 23 June 2016, we made a mistake and thus Brexit turns out to be another Millennium Bug.
The preparation will however be priceless if it means a business thrives in the post EU climate where otherwise it would not.
Simon Birks is a senior corporate lawyer at Cheltenham firm Sherbornes Solicitors and specialises in business sales, purchases, merges and restructuring. For more information, visit the Sherbornes website.