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This Time Next Year

The Business Barometer

Roger Aust of Close Brothers Asset Finance shares the results of its Business Barometer

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Brexit has thrown up many questions in the UK print industry, leading Close Brothers to survey the industry for answers

Brexit—implications for the print sector

Brexit is undeniably the single biggest issue that the UK has faced in generations. Media coverage is extensive, and every commentator has a view on the eventual implications. All the focus from both pundits and experts is on attempting to make sense of the vote to leave the EU and contextualise what it really means, and it is no different in the print industry.

At a macro level, Sterling slipped as did the FTSE and various other indices, but, as anticipated, they have all made a recovery, and, in some instances, to a startling extent.

As it happened so recently, data to substantiate various views and predications has been slow to appear; however, that is slowly changing. Every quarter Close Brothers Asset Finance conducts a cross-sector survey of SMEs called the Business Barometer that asks a variety of questions on a wide range of issues, including Brexit.
What the results tell us is that nationally, more than half of SMEs (56 percent) say they have felt no impact on levels of business from the UK’s decision to leave the EU, while a further 20 percent said it was too early to tell; only 24 percent had felt any kind of effect. In the print sector, the results closely reflected those of the UK as a whole, which tells me that it is clear that the majority of print businesses are yet to feel any real and tangible effect from Brexit.

More than half of SMEs (56 percent) say they have felt no impact on levels of business from the UK’s decision to leave the EU, while a further 20 percent said it was too early to tell

In terms of spending decisions, more than three quarters (76 percent) of businesses have not delayed spending or investment decisions because of the EU Referendum.

Once again, print businesses reflected exactly the national picture, but what is interesting to note is that 88 percent of smaller firms—those with a turnover of between £250,000 to £500,000—were the least liable to allow the EU referendum to stop them from pushing their business forward and investing.

Close Brothers has a history of lending through all economic cycles, and experience tells us that these organisations are not sitting on large reserves of cash, meaning that in order to maintain business levels they typically do not have a choice but to spend and invest to ensure a sustainable flow of cash.

Firms do not 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.

One alternative to consider is restructuring your business finances to make any rise in costs easier to deal with. A great way to do this is through asset finance, which is where our team of experts at Close Brothers Asset Finance can help.

Asset finance helps businesses spread the cost of major purchases over their lifecycle. The asset delivers the same value, but the cost of its acquisition is paid in stages as opposed to a significant one-off payment.

It relieves pressure on cash flow and frees up money to pay for other essential overheads, including machinery and equipment, managing complicated operations, client pitches, and ever wage increases.

Print is a significant player in the UK economy, but there are ways to mitigate the risks and still have a productive and successful business.

To find out more about the issues discussed in this article you can contact Close Brothers Asset Finance on 020 80030744 or visit www.closeasset.co.uk/print

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