European Referendum Result
We are about to enter a new era for business.
The European Referendum result is going to have financial implications for companies of all sizes.
The common consensus is that we are about to enter a two year rollercoaster.
We will see the value of the pound and shares fluctuate, interest rates and inflation will increase and new jobs will be harder to find.
We are likely to witness a self-imposed recessionary environment during this period.
It is inevitable that investment will stall and most firms will retrench.
Growth will be harder to achieve and cash will once again be the most important asset any company will have.
This is the initial reaction. This view may change in the weeks ahead but there is going to be some fall out.
How this result is likely to impact on the short term after the initial shock surrounding the result?
The European Referendum Result and the Printing Industry
How will this affect the £13.9bn printing sector in the UK?
Here’s how the printing industry has initially responded.
The raw materials will increase in price and this will add to the cost base.
Smaller digital printing companies should withstand this extra cost but for some of the larger commercial printers these costs are more significant.
The increasing interest rates will make the sales and investment in new equipment less viable.
As a small business we will certainly make no plans for any investment now until the dust settles.
The decreasing value of the pound will make exports more competitive but the value of our savings and investments will fall.
And there will almost certainly be another general election – which means more printing for us all!
Companies will look to reduce costs and printing is an easy area to save money.
Our print management service is an ideal option for small and medium-sized companies to save as much as 20% on their printing.
Our online printing businesses may even become attractive to continental customers!
The European Referendum Result and the West Midlands printing area
The West Midlands had the largest proportion of people voting to leave the EU.
The votes were probably based upon emotional rather than economic factors.
There appeared to be a fear of the forces of globalisation and manufacturers from around the world are now less likely to re-locate to the UK.
The dependence upon manufacturing and in particular the automotive and aerospace sectors will see activity levels stall in this area.
Because of the time frames these companies work to – this will more than likely take between 6 and 12 months to filter through to the local economy.
The service sector that feeds off manufacturing will find business harder when the current pipeline of orders is completed.
The financial services sector and banking will be particularly hard hit.
All of us as individuals will pay a price of some sort – even if it is in the short term.
New Business Opportunities
Many successful business start ups came during a recession.
The period of managing for survival offers an opportunity for creative thinking.
Many people have started self-employment with redundancy payments.
The internet provides a world of opportunity – as long as you can be found.
Longer Term Implications of the European Referendum Result
It is still a matter of conjecture but as a document printing business we have not exported a great deal.
When we have it has been easy within the European union but a disaster to other countries.
We have consignments held up by customs offices in Brazil for a period of two weeks.
An urgent consignment of training manuals for a client holding a course in Switzerland was delayed by the authorities and we had to arrange for a same day reprint from a Geneva printing company.
We have to fill out enormous amounts of paperwork – usually when we are under great pressure and time constraints.
Returning to the days of applying for Visas is also not looking good for the younger generations of business people trying to find new markets!
Embrace Change and Move On
Let us now hope that the generational divide and the geographical divide can be breached for the good of the country.
The more uncertainty we have – the deeper the recession will be.
We will now introduce our own Plan B.
I just hope it lasts long enough before I can draw a pension!