How Brexit Can Affect Your Staffing Firm

brexit-1491370_640Even if you were unaware of Brexit before, you know about it now. If you are a small to midsize company not doing any international business, you may believe Brexit may not affect you. You could very well be correct, but you also may be wrong. It would be sensible to explore the ramifications just in case you can be affected.

Let’s start with what we now know. Most pollsters called the outcome wrong; so much for experts. If you are a boutique company doing business locally, with customers also selling locally, you may be fairly well insulated from this event. However, your investment portfolio and hence liquidity that you need to help finance your operations may have already gone down due to the stock market declines following the vote. On the sales side, even if you are a smallish local company, your client may be doing a fair amount of business (directly or indirectly) with foreign companies and US operations you service may have foreign ownership.

Having said that, what could happen if you have even some indirect sales exposure? Due to the increase value of the US dollar, your goods will cost relatively more even if they are just a component to the European/UK end market customer and any other dollar-denominated product, such as oil. As noted, uncertainty is bad, people may cut back on buying goods and services “just because”. One more point, be prepared for opportunities (as well as risk) due to distressed situations. There may be black swan deals out there that we can predict, but once they happen be prepared to jump on them: great new applicants, distressed sales, business opportunities, etc. The answers are all the same: stay close to events and your customer and be prepared to act swiftly if needed.

Michael Neidle

Michael Neidle
Michael Neidle is president and CEO of Optimal Management, an advisor to staffing firm owners and managers.

Michael Neidle

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