Setting Up Shop In The UK



  • A UK base can provide opportunities for businesses
  • Good planning, a strong management team and communication are key to a successful move
  • It may become more difficult after Brexit with new rules in place

In focus – Brexit: With rules for trade in the UK set to change, how can businesses benefit from setting up a UK base?

Wexford based e-commerce firm Scurri believes it is bucking perceptions when it comes to the UK’s Brexit plans.

“You’d expect Irish firms to be moving away from a focus on the UK because of uncertainty, but we intend to get closer. We’re doing the opposite,” says chief executive and founder Rory O’Connor.

The company, which works with retailers and logistics giants such as DHL and TNT to enhance the delivery of online goods, is looking to set up a UK base, where the majority of its clients are also based.

Opportunities in the UK

“Brexit could mean more tariffs, tax documentation, more paperwork and more logistics costs,” he says. “The fact that business is about to get more complicated is actually beneficial for us as we can help our clients respond to these new challenges. We hope to set up a small office in London, expand our sales team and look at bringing in tax and customs experts.”

The business ties are strong between Ireland and the UK. According to the Central Statistics Office, exports from Ireland to the UK came in at €13.3bn in 2016 with imports at €15.55bn.

There was a Brexit effect with exports down 4% on 2015 and imports down 8%, but nevertheless it comes as no surprise to Michael Costello, managing partner at BDO Ireland in Dublin, that Irish firms are choosing to stay closer to the UK rather than turn their attentions away.

“The impact of Brexit has been profound in Ireland, with a steady increase of awareness and concern,” he says. “But the UK remains attractive for Irish firms because of the same language and similar tax and legal structures.”

Indeed, Costello says he is seeing more and more of his clients asking about acquisition opportunities in the UK. “The concern is turning to planning – particularly among larger companies – and they are thinking that a takeover of a UK company would make sense with regard to Brexit. To increase your sterling cost base, an acquisition or expanding production or offices in the UK makes sense.”

Strong management control

Setting up a new base or office in a foreign country has its pros and cons. Companies should always seek professional advice before contemplating any move and do thorough research on sector demand, demographics, levels of competition, analysis of costs, laws and regulations, and ensuring proper management control.

You can expand the recognition of your brand and expand your revenue potential with a bigger customer base. You also have access to new pools of skills and knowledge. But the cost in setting up the office and the time and investment it takes can take a firm’s eye off its core strategy and operations. There will be the need to hire new employees and set up bank accounts among other administrative and HR tasks.


“The impact of Brexit has been profound in Ireland. But the UK remains attractive for Irish firms because of the same language and similar tax and legal structures


Michael Costello, managing partner, BDO Ireland


“It’s a decision not to be taken lightly,” says Costello. “You need to plan well and have the necessary management bandwidth. That means having a senior management team in place with ideally the original management team being retained if it’s an acquisition. That is a big reason for the failure of any move – not having the management control.”

He says SMEs are being more cautious about acquiring in the UK because of their lack of financial strength, but says some have made the move successfully. However, setting up an office in the UK, he believes, is more straightforward if they maintain and ensure strong management control.

Even in a time of Brexit upheaval?

Costello acknowledges that Brexit is likely to mean pressure on input costs if based in the UK, dealing with tariffs and the free movement of people.

From a purely exporter’s point of view it may mean more customs administrations and declarations and more border delays with designated crossing points and checks.

But again, he says, with advice and preparation companies can acquire and set up in the UK.

John McGrane, Director General of the British Irish Chambers of Commerce, believes a UK base can even make an Irish firm Brexit-proof, avoiding currency risk and cross-border tariffs.

“Do it now and get ahead of the barriers,” he says. McGrane is spearheading a new online platform called the British Irish Gateway for Trade (BIG), which will aim to connect Irish and UK firms to form trading partnerships and to seek opportunities for acquisitions or setting up offices and bases.

“Irish firms are being encouraged to diversify and look at Asia to find new trade partners, but it takes longer and is more complex than doing what we do now with the UK,” he says. “There is huge demand for connections and partnerships, and the platform, which is on trial at the moment, will help achieve that. If you want to set up an office in the UK you will be able to log on and find the advisers, accountants, and lawyers in the UK that can help you. There will also be advice on tax, logistics and employment.”

It seems the key here for SMEs is to try and control Brexit, as much as they can, and not to sit on the sidelines waiting to see what will happen. By that time, it will be harder and potentially more expensive to react. They need to start planning and preparing now.

O’Connor of Scurri is yet to press the green light on its UK plans, but he says they are coming.

“Nobody knows what the Brexit implications will be. Possibly it will be harder to set up in the UK after Brexit with new regulations and finding employees,” he says. “But we are keeping an eye on everything and we hope to start the process of setting up our base at the end of this year.”



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