Property backed finance and second order effects
- AuthorStephen Proctor
Think you would not be affected by a ‘No deal’ Brexit because your business is not directly reliant on exports or imports or heavily dependent on staff from other EU countries? If you are in this situation, be careful to think about what are termed ‘second order effects’. This means looking at whether your suppliers, customers, financiers or staff are perhaps more vulnerable to potential economic disruption if a ‘No deal’ Brexit occurs.
Property backed business finance is very common in key sectors such as agriculture, care and retail. As we have highlighted in other Brexit planning articles, a period of potential economic disruption could mean you may wish to seek a temporary financial cushion – perhaps triggered by ‘second order effects’ rather than direct exposure to Brexit-related risks. Now is the time to assess where those risks might come from and to ensure you have your ‘house in order’ in terms of legal paperwork should additional funding be required.