The UK-based premium finance company’s study found that 34 per cent of SMEs expect to increase the amount and value of goods they have stockpiled specifically for Brexit – and this stockpiling is impacting business borrowing and cashflow. In fact, nearly six out of 10 (58 per cent) have increased their borrowing to fund Brexit preparations; the average amount borrowed being around £4,700 in additional credit, with almost 10 per cent of SMEs increasing their borrowing to over £10,000.
“SMEs have been trying to prepare for Brexit for more than three-and-a-half years and the Election result has delivered some certainty on the departure date although it is clear that a degree of uncertainty remains and trade deals still need to be negotiated,” commented Adam Morghem, Premium Credit’s Strategy and Brand Director.
That being said, the study also identified that 58 per cent of firms are optimistic for their future, and 55 per cent believe the Election result will help boost the economy as a whole.
But Morghem asserts that stockpiling, whether an optimistic preparation or not, is still a major issue for firms. “It makes sense for firms to be prepared but they should also check with their insurance brokers to make sure their stockpiled goods are properly insured,” he said.