With a deal between the UK and the EU finally reached in December 2020, businesses are getting to grips with what this means for them and their bottom line
44% of UK businesses believe that the agreement is a worse outcome than remaining as a member of the EU. Decision makers in medium and large businesses (51%) were even more likely to hold this opinion.
For policy wonks and business leaders alike, the Brexit deal announced at the end of December 2020 was an unusual Christmas present. For optimists, it could finally put to bed the uncertainty surrounding the Brexit process; yet for pessimists, it could confirm the reams of extra paperwork and bureaucracy required to trade with the continent.
Now that the dust has settled on the agreement, Savanta’s UK Business tracker can provide a unique view into how businesses of all sizes have judged the deal.
UK businesses views on the deal
2 in 5 UK businesses (43%) believe that the agreement is the best deal the Government would have been able to negotiate in its current position, compared to only a quarter (27%) who disagree. Positively, the proportion of businesses agreeing with this rises to half (48%) among those that have international operations.
However, our data suggests these figures do not tell the whole story: 44% of UK businesses believe that the agreement is a worse outcome than remaining as a member of the EU. Decision makers in medium and large businesses (51%) were even more likely to hold this opinion.
While we can surmise a lukewarm support for the deal amongst businesses, this does suggest that many are adopting the quintessentially British attitude of ‘making the best of a bad situation’.
The impact of the deal on businesses
For many UK businesses, our relationship with the EU has a direct impact on their operations, plans for the future and ultimately their profitability.
The impact of the deal is polarised across the economy, with equal numbers of businesses thinking it will positively (22%) and negatively (20%) impact their sales and revenue forecast.
Our analysis shows that the fault lines tend to be drawn based on the size of the businesses, with 35% of medium and large businesses anticipating a positive impact on their financials. They are also more likely to believe that the deal positively impacts their business’ ability to trade in the EU (36%) compared to smaller businesses (15%).
The end of uncertainty?
The Brexit deal aims to clearly outline the new relationship between the UK and EU, providing more certainty with which businesses can plan for the future. Our data suggests this has not yet happened: only 2 in five (41%) of UK businesses believe the agreement gives them more certainty on the UK’s short-term future relationship with the EU over the next 1 to 2 years.
With an unsightly squabble between the EU and the UK over limited vaccine supplies only just in the rear-view mirror and a new set of customs arrangements for businesses to familiarise themselves with, you could be forgiven for not believing the period of uncertainty has ended.
Get in touch: