Significant challenges for SMEs unless post-Brexit communication improves, says international trade expert

A Warwickshire-based global trade expert says UK SMEs will face significant challenges unless communication over regulatory changes are improved on the five-year anniversary of Brexit.

As research showing widespread concerns over the current EU deal’s potential to support growth, the British Chambers of Commerce (BCC) have called for the Government to use its planned EU reset to achieve concrete change.

David Hooper, Managing Director of trade consultancy Hooper & Co, has echoed the call, and says businesses – especially SMEs – are likely to face further issues despite showing “remarkable adaptability” since Brexit.

“UK businesses have demonstrated remarkable adaptability in the last five years, with many successfully restructuring their operations and supply chains to maintain EU market access,” he said.

“However, the BCC’s research shows only 14 per cent of exporters feel the current deal is helping them grow, highlighting the ongoing need for improved trade arrangements.

“While larger companies have generally managed to absorb the additional costs and complexity of EU trade, many SMEs continue to face significant challenges with customs procedures, documentation requirements, and regulatory compliance.

“The fact that 41 per cent of exporters disagree that the Brexit deal is helping them grow sales indicates the particular burden on smaller businesses.

“Some forward-thinking companies have successfully maintained their EU market presence by establishing operations within the EU.

“However, this adaptation strategy isn’t feasible for all businesses, particularly SMEs, and represents a significant investment that many cannot afford to make.”

The Nuneaton-based trade expert said there would likely be a number of additional headaches for smaller firms, which could be eased by improved awareness over new regulations.

He said: “The alarming lack of awareness about upcoming changes in trade rules and regulations – with over three-quarters of firms unaware of key legislation – suggests an urgent need for better government communication and support to help businesses prepare for future changes.

 “The emergence of new regulatory frameworks like CBAM (Carbon Border Adjustment Mechanism) and changes to product safety regulations (GPSR) are creating additional complexity.

“There’s growing concern more broadly among businesses about the potential impact of further regulatory divergence between the UK and EU, which could create additional barriers to trade.”

David said the anniversary also offered a chance to think about the opportunities for improved relations to support businesses.

“While businesses recognise that rejoining the EU Single Market or Customs Union is unlikely, there are practical opportunities for regulatory alignment that could significantly reduce trade friction,” he said.

“For example, alignment on food safety, plant health, and animal origin product regulations could eliminate duplicate checks and controls, reducing costs and delays for businesses.

“Such targeted alignment in specific sectors could deliver tangible benefits without requiring broader institutional changes to the UK-EU relationship.”