Brexit’s Effect on Business Procurement
Almost two years ago Britain voted to separate themselves from the European Union, making for one of the most disruptive political referendums to business procurement Manchester in modern history. UK businesses have been facing unforeseen levels of uncertainty after Britain’s decision to leave the EU, and many EU nationals that have been working in the UK are also thinking of taking their trades elsewhere.
Brexit’s past and current influence on the procurement sector has been quite disruptive, but it is still unsure as to what kind of impact Brexit will have on business procurement Manchester in the future.
Changes in Currency
When the referendum that prompted Brexit happened on June 23rd, 2016, one of the first things that happened was an immediate drop in the value of the British pound. In a single night, the GBP/USD dropped from highs of 1.50 down to 1.33, eventually dropping all the way down to unprecedented lows of 1.20 to the US dollar.
After some fluctuation, the British pound seems to have finally settled comfortably within the 1.3 range, currently sitting at 1.32443 at the time of writing. Many financial experts believe the immediate drop and lack of a proper recovery both point to an even greater impending dip for when Brexit finalises.
EU Remains a Necessary Ally
Although the Euro is tracking fairly similarly to the British pound in the past few months, a good sign for Britain and business procurement Manchester, Brexit had a much weaker effect on the EU’s financial stability. When Brexit referendum occurred, the EUR/USD only barely took a 0.05 hit, moving from 1.14 down to just below 1.1, before recovering up and above to the current 1.17 where it’s sitting at the time of writing.
These figures show that the EU is much less affected by Brexit than Britain and that Britain will have to work closely with the EU if it hopes to avoid greater financial downturns for the British pound.
Changing Currencies Mean Rising Costs
One of the direct effects on business procurement Manchester from Brexit and these currency changes is the rising cost of imports, with many UK businesses being prompted to re-examine their contracts to control expenses. Enterprises are becoming warier to start a business with provisions tied to the Euro or British pound, primarily due to the probable volatility of currency markets in the coming year.
The Butterfly Effect
While this article mostly looks at Brexit’s effect on British and business solutions in Manchester, Brexit’s boom could affect much more than just these municipal and national economies. While the referendum’s effect on the EUR/USD wasn’t too volatile and has recovered well, a larger drop could come quickly if any other nation decides to follow Britain’s EU exit strategy.
Contact Tailor Train Today for Business Procurement Manchester Solutions
With any kind of uncertainty in future markets, it’s important to prepare for any possible ramifications that could still arise due to Brexit. This blog post has shown that it is critical to consider currency with any kind of business procurement decision, while also keeping an eye out for any of Brexit’s ripples across the rest of the European Union.
If you’re worried about how to ride the uneven wave of Brexit’s repercussions for your business procurement Manchester, be sure to call Tailor Train at 07795 387 519.