Insights & News

Brexit? Give SMEs a break

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I don’t usually comment on political matters, but SMEs are once again being used as a political football, this time as the noisy debate around the UK’s referendum on EU membership hots up.

Both sides have been pushing their agendas hard. Apparently, 56% of SMEs say uncertainty around Brexit is already limiting growth [1]. Conversely, a rival survey suggests 46% of SMEs think the cost of EU regulations outweighs the benefit of the single market [2].

In reality, SME opinion is as divided as the wider public opinion. A recent SME poll by the Federation of Small Businesses found 47% of owners would vote to stay, with 40% voting to leave [3]. That compares to the latest public polls that show 37% want to stay, while 38% want to leave [4].

The truth is that estimating the economic impact of the UK leaving the EU is guesswork at best. No-one really knows what kind of trade deal would ensue. 

What we can be certain about is that the Brexit is not significantly holding up acquisition activity. Just last week, BCMS client Astech Projects – a robotics manufacturer in Runcorn – was sold to a German group, and we have UK SMEs about to sell to acquirers from India, USA and South Africa.

From Aberdeen to Zagreb, a good business is a good business. M&A is a global marketplace, and the factors that make it great apply wherever the border and whatever the trade rules are. The UK is not the world’s third biggest M&A market for nothing - and the things that make the UK attractive will persist way past voting day.  

US acquirers buy more UK businesses than any other country. They like us because we share a common language, and use a similar legal system or accounting methods. They want to be here to access our market size of 65 million people – European footprints rarely pop up when negotiating an SME deal.

Long may it continue.






Jonathan Dunn's picture
Posted Mar 2016
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