How can you manage the risks to your business of a hard Brexit?

Why am I talking about a hard Brexit?

I have written before about the risks of Brexit. I have always said that everything depended on the terms we got and I still say so. However, there is increasing talk of a hard or ‘no deal’ Brexit which cannot be ignored. Despite this, much of what I have written previously will still be relevant.

How to begin assessing the hard Brexit risks?

The risks of a hard Brexit need to be assessed in the same way as any other risks. First look at the probability, then the severity, before considering your control measures. Not that most of us can control the risk in terms of probability. If you can: please do! Most of those who voted Leave probably believed we would still be able to trade with the EU as it was in everyone’s interests. It was. It is. But…

What is the probability of a hard Brexit?

I cannot remember anything being so hard to assess. It makes weather forecasting look like an exact science. If nobody would benefit from a hard Brexit, apart from a few self-seeking politicians, why is it at all likely?

  • The progress of the negotiations so far does not make me optimistic.
  • There are so many things that could go wrong: in Westminster, in Brussels and in 27 other capitals.
  • The Russians could interfere covertly.

One problem most of us face is that of trying to tell reality from perception. How much of what we are told is a negotiating ploy by either side? Will the EU offer us a deal at the last minute, regardless of the rhetoric? Will the extremists in parliament act rationally when it comes to the crunch?

Happy and sad masks. Is the threat of a hard Brexit just a ploy?
Happy and sad masks. Is the threat of a hard Brexit just a ploy?
What about the severity of a hard Brexit?

Again, it is hard to know what is reality rather than scaremongering. However, in the absence of ANY agreement, there would be no guarantee that any contact with the EU could be maintained, at least in the short run.  You may argue that we can and do deal with countries outside the EU without much trouble. Yes. But we have treaties, agreements and other arrangements. In some cases, such as the USA,  there are visa requirements and travel restrictions. Some arrangements depend on our being in the EU.

How could a hard Brexit affect your business?
  1. You need to ask yourself what proportion of your sales goes to the EU. Then ask how realistic it would be to replace that with more sales in the UK or to non-EU countries.
  2. Next, you need to ask what supplies you obtain from the EU. How important are they? This is not necessarily all about volume or percentage. You might spend only a small percent of your costs on some component or ingredient, but it could be crucial to the running of the business. How easily could you replace it with something made in the UK or elsewhere outside the EU? Or change your processes so you can do without it?
  3. Then there’s the problem of a supply chain that crosses the Channel several times, as is common in the motor industry. Is yours like that? Does it have to be?
  4. How time-sensitive are your supplies or sales? How seriously would bureaucratic delays at ports affect them? Would better planning be the answer?
  5. Even if you think you are safe, check on the sources your suppliers depend on and ask what contingency plans they have.
  6. You also need to consider your dependency on EU workers. Again, how can you replace them from the British workforce or from elsewhere?
How hard would hard be for you?

I remember an episode of Only Fools and Horses, where Del got involved with a singer with a lisp. He couldn’t pronounce his R’s. After a catastrophic performance, everyone was expressing anger. The singer said, “I’ve got a good voice. Does it matter that I can’t pronounce my R’s?”

Albert said, “It only matters if you’re singing songs with R’s in them.”

My point is that you could be worrying too much, if leaving the EU without a deal would affect only a small proportion of your costs or sales, or if you have alternative sources of supply.

Finally, what about a soft Brexit?

You cannot assume that a deal would remove or greatly reduce all the above risks. Not every industry or every activity will necessarily be protected. Not every arrangement will be cost-free.  Many people have said that uncertainty is bad for business. Yet there was always going to be uncertainty during the negotiating period (and probably beyond, as the devil is in the detail). M Barnier has rightly said several times that nothing is agreed until everything is agreed. Anything else would tie negotiators’ hands too much. However, it means we will have to live with uncertainty right until … whenever everything is certain.

Dice. Uncertainty is not going away.
Dice. Uncertainty is not going away.

If you want to go through any or all aspects of the impact Brexit might have on your business. Let me know.

01925 445215


Smartmeters: you know the benefits, but what are the risks?

You do know the benefits of smartmeters, don’t you?

Smartmeters give you and your electricity provider access to uptodate information about your electricity consumption. Therefore:

  • People don’t have to go to the trouble of reading your meter monthly or whatever
  • You can see if an appliance is using more electricity than you thought
  • If you accidentally leave something switched on, you’re more likely to notice.
  • You can take action promptly to reduce waste
What risks come with smartmeters?
  • Some people claim the installers were inexperienced and/or incompetent, causing an electrical fire. Others claim there was a risk but no fire occurred.
  • Some of these gadgets have not worked properly and generated excessive bills
  • Others have not worked at all
Surely not all smartmeters are that bad?

No. The bad cases are probably a tiny percentage that gets the most publicity. Anyway, let’s hope the installers have learnt from their mistakes, as we all should. The risks were probably always small and should be declining.

Is now a good time for getting smartmeters?

Not necessarily. There are three things to bear in mind.

  1. Firstly, you don’t get the benefits automatically. You have to look at the smartmeters and act on what you see. It’s all too easy to assume that you’re using energy efficiently just because you have had one installed.
  2. Secondly, the benefit depends on how inefficiently you were using electricity in the first place. If all your appliances are efficient, and if you are diligent about turning things off or down, when not needed, there is not much a smartmeter can do for you.
  3. Thirdly, the potential savings are bigger if you are using a lot of electricity. If you live in a small house, if you are not in very much, if you don’t have many electrical appliances, then there won’t be much scope for savings in any case.
So am I for or against smartmeters?

It depends on your situation. For many people, installing a smartmeter could be a great idea. For others, a waste of time. Sadly, for a few, it could be a really bad move.

Like anything else, you need to weigh the potential benefits with the costs and the risks. Perhaps you need to talk to someone about this or some other risk affecting you or your business. You know how to contact me.

If you want to save money on electricity, gas, phones or broadband, ask me or go to

Here are two books to help you study in the new term

If you are going to  study business studies or something similar

You will want to understand managing risk. Here’s a simple guide I have written that you could find useful: Risk and Win!

It is published by Business Expert Press of New York. Its contents are as relevant whether you are going to study in the USA or the UK and probably most other places too.

If you think “risk management” is a bit of meaningless management-speak, this is the book for you. The World is full of risks and they all need managing. In fact, we all manage risks all the time whether well or badly. Every decision we make involves making some assessment of the risks involved. Risk management is simply an attempt at doing it more explicitly, scientifically and, hopefully, effectively. In this book, you learn more about the “Why” and the “How” of risk management, and you will find some examples of how not to do it. I have tried to explain it in everyday language and show how it can be applied in a small business to your advantage.

Whatever you study you will need statistics

You may be a producer of statistics or not. You will certainly be a consumer of them. Here’s a book to help you avoid the pitfalls.

It is available on Amazon and Kindle

How To Avoid Being Misled By Statistics by [Murray, John]

Three kinds of people ought to read this book.
Firstly there are those who use statistics in their work: accountants, scientists, advertisers, marketers, politicians and journalists. If you are in one of these categories I would like to help you to maintain, or aspire to, a reasonable standard of honesty and integrity, so that people can trust what you say, and so that you do not even inadvertently mislead yourself as well as others.

Secondly there are cynics who think statistics can never be trusted and are just tools used by liars. I want to show that they can be used properly, and also that with a little thought, we can all learn to spot the false or exaggerated claims, the non-sequitors, and the unsubstantiated assumptions. Then we will be able to see the truth when it appears.

Thirdly, there are the huge number of ordinary people who get totally confused and sometimes, sadly, misled, by statistics. I want to help you make sense of what you read or hear, and be able to be confident in sorting the facts from the hype.

It is for this third group that this book is really written. If the other two groups benefit, I will be glad, but if you are in this group, please read on. I hope you will enjoy it, but above all I hope it will empower you.

Whatever you are going to study, you will find this book worth keeping beside you.

What have the birk and the burqa got to do with your reputational risk?

If you don’t have any clients who wear burqas, still read on!

When it comes to the burqa or other aspects of dress codes, I do not intend to advise the former Foreign Secretary or anyone else. I am trying to help you manage your reputational risk. Similarly, my recent article about the row in the Labour Party (remember them?) over antisemitism was not about politics but about  managing this same risk. The current row is certainly affecting the brand image of the Conservative Party as well as that of Boris Johnson. What could affect yours?

Let’s put the burqa row in perspective

People’s views on this subject don’t seem to be based on the issue itself, but on their views on:

  1. Boris
  2. Islam

Few people will not have opinions already on these two subjects. Some people have noted that those attacking Boris most loudly tend to be remainers in the Tory Party, whilst those who defend him tend to be Brexiters.

My point is that the reactions might have been different had anyone else said what Boris said. I expect Boris was aware of that when he wrote the article about the burqa. He probably wanted to create some controversy, as he likes and needs publicity. Any kind. He probably guesses that the people he is offending are not likely to be too fond of him anyway. Meanwhile, his supporters might include many who either don’t care, or share his views.

What is the lesson for you from the burqa row?

As I said in my article on antisemitism in the Labour Party, context is everything. Some people are always willing to take offence, even on other people’s behalf, especially if the culprit is someone they don’t like. Who would be quick to point to allegedly offensive elements in  your advertising, publicity or press releases?

Would a perceived offence affect your reputation among the people you want to do business with? That would probably depend on the nature of your product or service and on the type of image you have cultivated. Any hint of misogyny could be catastrophic if your target demographic was young(ish) women. It might be less so if you were managing a night club.

All right! What about the burqa issue itself?
  • I am aware that there is no requirement in the Koran for women to wear any particular items of clothing, so long as they dress modestly. The interpretation of that varies among different schools of Islam and different individuals.
  • Boris did not call for a ban, but merely stated that in his personal opinion women in burqas looked ridiculous. Cannot anyone express an opinion about anyone else’s appearance?
  • If someone criticised or ridiculed the dress of Christian clergy, from mitres to dog-collars, it would offend a lot of people. However it would not lead to calls for sackings or disciplinary action.
  • When I try to look at this objectively, I think Boris’s critics are overreacting. However, as I have said already, context is crucial.
A monk. Is his habit ridiculous in the 21st century?
A monk. Is his habit ridiculous in the 21st century?
What is the context of the burqa row?

The context is of a rise in hate crime, of immigration being a toxic issue, of the Windrush scandal and of many British Moslems feeling unwelcome. In this context, Boris’s comments were unwise and potentially inflammatory, especially coming from such a high-profile individual.

My advice on managing your reputational risk is to think about the context in which you are operating. Objectivity is not enough.