Over the past week and a half, the conversation around tariffs has dominated headlines, amplifying the sense of uncertainty that many businesses are grappling with – and for UK organisations in particular. This is against a backdrop of increasing costs due to NI and minimum wage increases.
I’m especially mindful of the concerns facing businesses which rely heavily on exports to the US. Perhaps, however, we are in a stronger position than we think, given we are the world’s second-largest exporter of services.
The Prime Minister’s recognition that the world has changed in light of recent developments is accurate, but we must remember that the impact of this change is not something we are powerless to influence. We still have agency in how we respond to the evolving landscape.
Some silver linings?
The terms of global trade seem to be changing almost daily right now – and may indeed have been rewritten again by the time you come to read this. Regardless of how the landscape evolves though, it seems likely now that the cost of doing business in the US will rise and that global supply chains will be exposed to disruption in numerous ways, many of which remain to be seen, given the interconnectedness of the supply chain.
Businesses are also likely to delay major decisions about investments, expansion, and hiring. But in this new world, there is opportunity amongst the risk.
There is some speculation that UK manufacturers could find themselves in a position to win business from global companies looking for alternative manufacturing capacity, given the relatively favourable access to the US and EU markets.
The tariffs could also result in a reversal of some businesses that left pre-Brexit due to the more punitive proposed EU tariffs – which, despite being paused, still loom.
An opportunity for service to shine
Beyond this though, it is through our strength as a Service economy that the UK remains less exposed compared with many others, who rely more heavily on manufacturing or commodity exports.
As I’ve said before, the best approach to trading through uncertainty is with exceptional service. Customer goodwill is becoming an increasingly invaluable asset that can bolster business performance even in difficult periods. Being seen internationally as a country that welcomes trade, wants to build relationships and can consistently serve customers well will enhance the UK’s ability to strike favourable trade agreements and win international business.
On the domestic front, it will be crucial to communicate openly and proactively with customers, whether it’s about product delays or potential price increases that the incoming supply chain disruptions might cause. Business challenges – whether tariffs, skill shortages or tax increases – can’t be used as an excuse for poor service.
If we think back to the days of the pandemic, many organisations went out of their way to show empathy, offer guidance, and simply demonstrate to their customers that they cared.
At a time when many consumers may be more anxious about the future, this environment provides a chance for businesses to differentiate and show genuine support for their customers.
Instead of dwelling on the negatives, this is a chance and a need to focus on the opportunities to showcase what Britain’s service economy is truly made of.
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