The Dun & Bradstreet UK team hosted a webinar on July 27th, that gave insights into potential business consequences of the BREXIT vote. Read the highlights from the webinar below!
Potential Affects of Brexit on Small Businesses
As the business world scrambles to adjust to the new post-Brexit vote landscape, it is important for small businesses to remain level headed. Britain’s imminent departure from the European Union (EU) has catalyzed a sense of uncertainty, but Dun & Bradstreet’s Country Risk Module can help. The Country Risk Module’s team of expert economists, who specialize in comprehensive analysis that helps businesses understand potential global risks, has provided recommendations on navigating the post-Brexit vote world. Below are some highlights from the team’s recent Mid-Year Global Economic Outlook Report.
1. It is important to understand that it’s too early to assess the political and economic impact of Brexit.
Article 50 of the Lisbon Treaty, which allows for a country in the EU to voluntarily leave the union, still requires invocation – the European Union and the United Kingdom must negotiate the terms of the UK’s departure. As a result, it is unclear how Brexit will affect citizens, businesses, and countries.
2. The impact of the Brexit vote has been largely contained in the United States.
However, the domestic market will remain volatile as risk perception varies. As a result, currency movements will impact short-term business strategy, meaning business owners should remain aware of current market conditions.
3. In the medium term, it is likely that sustained uncertainty could result in the appreciation of the dollar.
As a result, global credit conditions could tighten, meaning the conditions required to obtain a loan could bring about a reduction of the overall availability of loans.
To help give your business a greater chance of receiving a loan, consider building and monitoring your business credit file. A strong business credit file may give you an advantage over other loan candidates, if the scores and ratings in your file help show that your business makes payments on time, isn’t at risk for bankruptcy, and is likely to pay back the loan. With CreditBuilder™, you can help build your business credit profile and use it as leverage when applying for a loan. If you don’t end up getting a bank loan, you can look to alternative funding sources such as online lenders or crowdfunding.
In sum, Dun & Bradstreet’s Country Risk Module recommends that businesses frequently revisit their strategy in view of the fluid, uncertain conditions and how they evolve. Businesses with exposure to foreign markets should be especially cognizant of foreign exchange volatility, and all businesses should stay updated on the health of the global economy. Consider monitoring your partner’s business credit to help reduce uncertainty and minimize risk.