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Even if the Government has ‘reports’ on the UK’s future after Brexit, it would remain foolish to rely on expert opinion about an event which hasn’t already taken place

December 27, 2017 Leave a comment

download (9)Brexit has been created by a phenomenon, the elements of which many of us are still failing to understand. For non-decision makers, this is just a social problem between people who are usually friends. But for our politicians it has now become an elaborate game of pin the tail on the donkey which risks much more than a simple prick to the finger if they get their blindfolded judgement wrong.

The exquisite mix of having a government led by people who do not believe in what they are doing, trying to deliver working solutions to problems that they do not understand would in any other situation be recognised for what it is. But politics has regrettably moved on from an age when it really was in some way chivalrous – if it ever really was, and power being all, is all it has now become.

This insidious environment does not lend itself well to the power of original thinking. Trust has become as interchangeable with myth as proof has become with fiction, and unrelated history has become the benchmark of reliability against the future that we can also not personally see.

Measuring the possible impact and consequences of Brexit against such a backdrop is therefore down to either fortune telling – which is at best no more than ‘an educated guess’, or of relying upon economic viewpoints and philosophies which have been developed on the basis of events that have already passed, rather than what will actually happen in the future.

Put simply, nothing like Brexit has happened before and nor will it happen again, as even the smallest difference – perhaps down to the outlook of just one of the key players involved, could deliver an outcome which we could never imagine.

That the Government and Ministers responsible for any part of the Brexit process may or may not choose to rely upon reports which have been devised in this way and within this unique set of circumstances, is perhaps more about their own take on the opinion of others, rather than anything we could really label as setting out to deceive.

Whether they be Specialists, Experts, Economists or not, it is little more than opinion that they actually give and we would all do well to remember that even then, nobody has the ability to offer such ‘expert analysis’ of an event which has not already taken place.

Yes, we all have concerns about what is to come as a result of Brexit. But staying within Europe would not in any way have meant that a stable future of any kind was assured. And it remains worthy of note that whilst Brexit may prove to be temporarily challenging for us, for the UK to have remained a member of the EU may in time have proven to be truly catastrophic.

 

image thanks to fortune.com

Brexit and the influence of Corporate Business: Money talks and the rest of the business community walks

Brexit 2The result of the European Referendum was a surprise to many, and that includes a substantial part of the leave side itself. Yet over a year on, with Article 50 Triggered over 3 Months ago and David Davies now participating in regular sessions of ‘negotiation’ with the European elite, nobody seems to know what impact Brexit will have on any of the key issues, and whether any of what are being considered as the obvious problems which led to the ‘No’ Vote will really have been resolved.

With Brexit constituting a polysemic reference point which in the imaginations of everyone will look as different as the number of people you might ask, it is perhaps no wonder that there really is as much confusion as there appears to be about the whole process.

Some do of course interpret what is already the natural anxiety which is accompanying these early stages of our departure from the European Union as change in the minds of the majority that initiated this whole process. Yet they would do well to remember that none of the reasons which prompted that significant choice on the part of so many have as yet been resolved, and especially so in the case of the many more beyond those generally accepted and not least of all the spectre of corporate and political self interest.

It should really be of little surprise that things have looked like such a mess in these circumstances and genuinely forgivable given the lack of pre-Referendum preparation for its outcome and the chain of events including a change of Prime Minister and an arguably unexpected General Election which has distributed power in peculiar directions.

What is less easy to overlook, and perhaps should be of great concern to us all, is the readiness of former remain-backing politicians to focus upon the opinion and input of sources from the corporate world who also sought the same outcome when considering what will or wont work for business-full-stop, when what they appear to hope will be an indefinite period of transition commences in March 2019 and we formally leave the Union.

Input of organisations such as the CBI, whilst important in its capacity as a member-based industry voice, is nonetheless representative only of the executives and companies for whom they work, and therefore the highly subjective and specifically profit-led interests that they all have in conjunction with their own trading arrangements with Europe – rather than what is objectively in the better interests of us all.

Whilst it may be to some degree inevitable that UK-European trade will come at a greater cost to all businesses in the future, these changes will in real or financial terms be no different than the changes in costs of manufacturing, supply and service provision which have accompanied change after change after change which have been instigated by a continual flow of new European Laws and Directives when they hit relevant businesses. In fact, it is only the fact that this is an industry-wide phenomenon, rather than just another hitting one sector or another, which really marks leaving the European Union itself as being markedly different from changes that to real business, would really be ‘just one of those things’.

It would be disingenuous to suggest that the Government is listening to the wrong people, but it certainly does not appear to be taking into account the realities facing the complete range of the right ones either, and when the views of Remain-lite big business are put into their true perspective, the news is arguably far from as bad as the comparatively few companies which are big enough to swim in the pool with the CBI and have influence on its own Policy would like us and the Government to think.

Motivation is regrettably key, and whilst it is considered normal to talk about the individuals who give voice to CBI membership and the corporate business community as being representative of the ‘business view’, very few, if indeed any of the people who have reached the top of these large Companies will have really cut their teeth in the furnace of SME business start-ups, development and management. It is here where you ultimately have no choice but to accept, get on and work with legislatory change, or get out of the market and let someone else have a go if you can no longer make it work.

Small business, which suggested by Federation of Small Business (FSB) figures makes up at least 60% of industry, thrives on being adaptable and embracing each and every change that it will face, which for most will come to them pretty much on almost daily basis. What it doesn’t have – even with membership organisations like the FSB  – which are again only technically representative of the views of their members with a voice – is a seat, or what should be a significant number of seats around the ‘top table’ when it comes to getting the ear of Ministers and indeed our Government.

This is a travesty, as the business environment which they inhabit is the real engine room of our economy, and the place where industry feedback is most open and reflective of the concerns and realities which really do face all businesses.

SME’s are the business equivalent of the electoral grassroots and the only place to go if Government really wants to establish the priorities of British Business to inform our negotiations with the EU as we transition through Brexit to what may then prove to be a much more productive world for the British economy beyond.

 

image thanks to news.sky.com 

 

 

 

Peer to Peer unsecured business lending for SME’s is on the rise. But are you surprised?

The internet culture of openness and sharing is promoting massive changes for businesses of all sizes, as the continuing upsurge in businesses aiming to develop both our social media knowledge and use will easily confirm. But the gaps which have been bridged in one way by new basic communication mediums are now developing into fully fledged by-passes in others and not least of all through the proliferation of peer-to-peer lending sites such as Funding Circle.

When taking my first real plunge as a start-up with a solid distribution contract 8 years ago, I would have leapt at the chance to obtain £250K unsecured lending from a range of private investors. Instead, I had no option but to give a charge against the equity on my home to a high street retail bank. I’m sure that many who have driven the development of an SME whilst being the sole bread-winner at home will relate to the experience of having your partner crying as you call in at your solicitors to complete the paperwork.

But business is inherently risky, and that’s why not everyone does it – or receives the benefits that come with it. Banks however, look very much like they have become ‘penny wise and pound foolish’ when it comes to business vs corporate lending and you won’t have to dig far in to the realms of the recent Banking Crisis and the current Eurozone debacle to see where the big money has been going.

In the past, decisions on lending were actually made by a branch manager at the local bank, who wouldn’t have to talk to a faceless lending ‘specialist’ on the phone or enter all the relevant data onto a network to see if your sweat-soaked business plans were credit worthy, because they took the time to know a client and could see where real risk would lie. I can honestly remember the reverence that the ‘bank manager’ was given when I was a child – not unlike that of a GP or a Dentist. And Oh… how the times have changed.

I would guess that I am far from being alone in having sat with a Business Relationship Manager to talk through the acorns of an idea to see if the will was there to provide funds, before taking a nod away with meto go and commit many further hours of work to creating a written business plan, to then have it quashed in moments when it travels further up the chain by someone or something which basically has nothing more in mind than having one’s cake and then eating it. Put bluntly, it looks very much like interest, security and surety are the 3 requirements of high street retail business banking to small and new business today, and any more than  2 such caveats are not only unrealistic, they are wholly unreasonable.

Not one moment too soon, peer-to-peer lending has arrived, giving entrepreneurs the opportunity to put great business ideas to open-minded lenders who are able to listen to the thought and actually experience the passion behind an idea, and then make an emotional evaluation of the weaknesses and strengths of that concept or perhaps just a plan for expansion, before deciding whether they want to make a similar leap of faith. Even the Government has been caught on-the-hoof with this growing concept pledging no less than £100 Million to support this type of borrowing.

The irony is that for those ‘peers’ choosing to lend and perhaps spread £100K in £5K chunks across 20 different projects, they are spreading their risk widely after making a proper evaluation of all the lending AND receiving a good level of interest too. Banks would perhaps do well to bear this in mind as they go chasing the sure-thing of that golden egg dropping into the basket which comes from a hen with a great set of teeth…

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