Research published yesterday from the Federation of Small Businesses (FSB) revealed information on what small businesses are looking for from Brexit trade deals, with a trade deal from Europe topping the list.
The survey, titled Keep Trade Easy: what small firms want from Brexit, gathered information from 1,758 FSB members.
63% of those surveyed described access to the EU single market as the most important deal to them. The importance of other markets was also cited, with nearly half (49%) of FSB members choosing the US market as their top priority, 29% picking Australia and 28% prioritising a UK trade deal with China.
A quarter of exporting small businesses said any tariff on exports would deter them from trading with the EU. A third of small business exporting firms said that a tariff of 2-4% on exports would deter them from trading with the EU. This has been the average rate from the EU under the World Trade Organisation for the last few years.
It’s not just tariffs that concern small business exporters, as small businesses admit they would find administrative burdens, such as dealing with customs, to be just as important.
Over half (58%) of small businesses find EU single trade market easier to trade with than non-EU markets. 45% of exporters and 53% of importers find it cheaper to trade with EU single markets compared to non-EU markets.
Mike Cherry, national chairman of the FSB, said: “Small firms trade with countries based on ease, cost and value and any future trade deal must deliver on these key aspects both with the EU single market and non-EU markets.”
Cherry placed emphasis on a steady introduction into the agreed trade deal, in order to help small businesses: “Compared to larger companies, small businesses typically work to tighter margins with limited resources, meaning changes to the trading landscape will hit them disproportionately hard. We call on the Government to ensure that a sensible phased implementation arrangement is put in place to avoid a cliff edge, once we have left the EU.”
He added: “Trade support needs to be tailored to what small firms really need, from the type of priority markets that would have the greatest traction with small firms to specific support measures such as small business trade missions. FSB is also keen to explore with Government the role financial incentives such as export vouchers or export tax credits could have on small business exports.”