SOMEONE asked me my opinion on Brexit the other day, and as it is just around the corner and there seems to be a lot of uncertainty on the table at the moment, I thought I’d share it with you all.
We’ve seen a great deal of news both for and against our departure from the EU. We’ve also seen a lot of debates positive and negative. However, I feel we are not in a great place as a country, as we are all so split on our position, rather than being a ‘United’ Kingdom.
The constant propaganda being pushed from both sides is leading us down one path or another, dependent on how the writer wants you to read an article, or how you decide you want to read it. Take myself for instance. I’m a ‘glass half full’ kind of guy, and some would say I tend to look at life through rose-tinted glasses a lot of the time. I do pretty much always look for positives.
For instance, I read an article about the UK losing a business relationship and the headline was written in a way that made me believe that this was going to damage the UK. However, the actual loss would be for a company based in the EU that is set to lose 70 per cent of its customer base, as it is currently all based in the UK. So, my brain read it in a different way than intended, and that it is as much of an issue for another country as it is for us – so both would lose out, not just the UK.
Looking at Brexit in totality, we are probably going to hit some volatility, no matter what the outcome of the current negotiations, and we probably won’t be the only country in Europe to have issues following Brexit, so we should definitely be prepared. However, we should always be prepared for a worst- and best-case scenario.
A worst-case scenario, for instance, could be that a recession is likely. Let’s say consumer confidence drops following uncertainty about the United Kingdom’s exit from the European Union. It’s already at a very low position according to market research institute GfK and that’s being pegged up by strong employment, low interest and low inflation rates. So, if UK consumers start to see companies going into administration, ceasing trading and employees losing their jobs, we could see it significantly hit consumer confidence and sales everywhere.
What does this mean to us?
Well, the motor trade should be prepared for a lower turnover of stock in the short to medium term at least. We should expect fewer cash buyers, as people save their money for a rainy day, and we may expect to see some rate increases from finance companies and banks, maybe even fewer acceptances as finance companies tighten their belts. Finally, motor traders may need to look at some cost-saving techniques to help tread water through the tough periods.
The best case could be that we see some stability and nothing significantly changes, meaning consumer confidence grows, sterling rises and as such we continue to work hard on converting our leads, offering great deals and great service.
If anyone has a crystal ball that can tell the future, feel free to give us all a heads-up, but in the meantime I’ll keep formulating my thoughts on both possibilities and proceed carefully.
Ben Garside is marketing manager for First Response. Call him on 07817 518739 or email [email protected].