More than half of Britain's small and medium-sized food and drink manufacturers exporting to the EU have experienced reduced profits due to post-Brexit trading requirements, according to a new survey. The research, which surveyed 600 firms across Great Britain, found that 55% of SME exporters to the EU and 47% of importers reported lower profitability since new trading rules were introduced in January 2021.
The findings emerge as the government is negotiating a new food and drink agreement with the EU, aiming to simplify trade and reduce costs. Environment Secretary Angela Eagle stated that the government is working to cut red tape to ease pressure on food price inflation and support British businesses.
For SMEs that have ceased trading with the EU since 2021, 69% of exporters and 55% of importers identified Brexit as a primary reason. However, the survey also indicates potential for trade revival, with 58% of food and drink manufacturing SMEs believing a new UK-EU agreement could help them increase, resume, or begin exporting within a year.
When asked about priorities for enhancing or establishing exports to the EU, SMEs overwhelmingly highlighted less paperwork (79%), lower trading costs (78%), and fewer border delays (71%). Similar priorities were identified for imports from the EU.