Last month's Brexit vote is already having an impact on business decisions at small firms in London, according to research from Robinsons Chartered Accountants.
A survey of 800 small and medium-sized enterprises found several key concerns were hampering their ability to make business decisions in the uncertain political and economic climate that has followed the referendum.
The lack of political leadership in the UK, due to an imminent change in prime minister, was a major concern.
Also weighing on executives' minds have been the potential economic effects on access to capital and cost of borrowing due to the loss of the UK's AAA rating, as well as government inability to reduce the deficit.
In addition, cross-border trading concerns, the possible inability of recruiting foreign talent (and an ensuing brain drain of European expertise) and worries that more compliance administration could be loaded onto small business owners were all risks smaller businesses were being forced to grapple with.
Joseph Robinson, managing partner at Robinsons, said:
London small and medium-sized enterprises are understandably worried about a possible slowing of economic growth but they cannot stand still. A potential lack of political decision could create a sterile business environment. In contrast, small and medium sized businesses need to proactively plan for the future.
Research and development and new capital investment are likely to be the first areas to suffer but scenario planning will enable businesses to trade through any resulting economic slowdown with added assurance.
He added: "It is crucial to approach this period with an objective, proactive and diligent mind-set. The uncertainties brought about by Brexit are undoubtedly forcing businesses to re-assess their position but providing they look for both risks and opportunities there is no reason they won’t be able to mitigate any long-term negative effects."
From the day of the referendum result, business confidence was shaken. Some international startups said they could be deterred from incorporating and expanding into the UK market, as they were gripped by similar fears about trading uncertainty and regulations.
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