Lincolnshire businesses remain cautious despite Brexit export high

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The drop in the pound following the vote for Brexit has led to a growth in exports for Lincolnshire firms with sales to the EU rising, but businesses remain cautious due to uncertain times.

Despite predictions that the vote for Brexit would see disruption in business across the country, this is yet to be seen, other than the fall in Sterling immediately after the result was announced in June.

Since then, the strength of the pound has remained at near record lows.

Although this has meant higher costs for companies that import, for those exporting it has allowed businesses to bolster profits.

Businesses remain cautious though as economists suggest that it may not last for long.

Heritage Upholstery based at Cedar Parc Industrial Estate near Lincoln has said that export growth has remained positive, however as the business sources its product from overseas, this has also had a financial impact.

Martin Fahy, Director of Heritage Upholstery, said: “Growth has actually remained positive with sales to the EU significantly up in the past 12 months, but there has been a financial impact from the weakening of sterling as we source much of our product from overseas markets.

“From a financial perspective there has been a negative impact driven by the fall in sterling and we have had to manage this appropriately from a cost and pricing focus. However, trading generally has been good and we continue to grow.

“We continue to see demand for our products growing both within the EU and across the world, so any Brexit effect on trading has been immaterial from a revenue perspective but clearly the fall in Sterling is affecting margins.

“A continued weakness in Sterling would be a negative for the business but we will find a way to manage that over time.

“In general the outlook is positive with significant increases in overseas sales in the last few years and little sign of this changing. The opportunity to scale the business ultimately remains.”

Managing Director of Siemens in Lincoln Neil Corner. Photo: Steve Smailes for Lincolnshire Business

Siemens Industrial Turbomachinery Ltd based in Lincoln has also seen a rise in exports over the last year, however the company now looks for sustainability.

Neil Corner, Managing Director of Siemens Lincoln, said: “Although a weaker pound is helpful for exports and can increase or accelerate customer orders, which is no doubt good for our manufacturing business in Lincoln, overall the most important thing is for a sustained, stable environment to maintain future business and future investments.

“Our business in Lincoln serves a global market so we are protected to some extent from the uncertainties around Brexit, nevertheless we hope that an agreement can be reached in the common interest which maintains free trade and constructive collaboration between the EU and UK.”

Justin Brown, enterprise commissioner for Lincolnshire County Council, said: “The drop in the pound has both its pros and cons for Lincolnshire businesses.

“On the one hand, our exporters have become more competitive, winning new business, but, at the same time, those that rely on imported components are seeing their costs go up.

“The government is really pushing exporting at the moment, so if businesses do want to give it a go, there is plenty of support available.”