Leonard Engineering Brexit ready for eventual departure

Ballybay, Co Monaghan-based Leonard Engineering is a fourth-generation structural steel company with roots dating to 1901. It employs 75 people directly, plus a number of contractors, supplying structural steel to a range of sectors, from commercial and retail to schools.

Over the past decade it has been particularly successful in steel used for the construction of data centres across Ireland and, more recently, Sweden, where it works with two of the world’s best known US multinationals.

Since the Brexit vote, in 2016, director Jason Leonard and financial controller Stephen Dignam have worked through a Brexit readiness plan in preparation for January 1st, 2021, when the United Kingdom finally leaves the EU.

A major part of this has been ongoing liaising with UK suppliers with whom it has long and trusted relationships.

“A number of our raw materials come from the UK, as well as consumables such as paint, machine parts and PPE [personal protection equipment] for staff. All along the way we have been working with our suppliers to assess what impact Brexit will have on them and to see what steps they are taking, to know that they are ready for Brexit,” explains Jason Leonard.

Having those fears allayed has been a relief for a family business that has grown on foot of the high quality of its products. Replacing key suppliers is something no business would do lightly, says Stephen Dignam.

The hardest part for any business in relation to Brexit is the uncertainty, says Leonard, pointing out that, for example, while there is a zero per cent tariff rating on steel, that may not always be the case.

The best way for Leonard Engineering to proceed therefore has been to make certain all those things that can be made certain, says Dignam.

That includes buying forward as much stock as possible in advance of January 1st, to give the company additional headroom in the event of shipping delays. Though doing this puts additional pressure on cash flow, it’s worth it for the peace of mind, he says.

Getting good advice on Brexit preparations has been vital. "From day one Enterprise Ireland has been a great help with our Brexit planning," says Dignam.

“They have always been very hands on and offer online seminars and a very good website, prepareforbrexit.com, which provides case studies that feed you through ideas about what you need to be doing,” he says.

Enterprise Ireland provides financial supports too, including a ready for customs grant, a strategic consultancy grant and its market discovery and agile innovation funds.

"We're in the fortunate position of not needing grant support in relation to Brexit but EI [Enterprise Ireland] has been terrific in terms of giving us the information and the tools we needed to get ready," says Dignam, who says the company has also worked closely with InterTrade Ireland, the cross-Border development agency, on Brexit readiness.

One area that required the company to undertake significant work was in relation to standards. The business’s CE mark, which is required of a product to show compliance with European Union standards, was previously awarded by a UK standards authority.

To ensure continued compliance to EU standards, in case of regulatory divergence post-Brexit, Leonard Engineering decided to apply for its CE mark through the NSAI (National Standards Authority of Ireland) as well the new UK equivalent, the SCCS mark, from its UK standards authority.

It was an additional expense and was time consuming – it meant having two audits – “but it was worth it, because now we have both marks”, says Leonard, who now believes the company is as ready as it can be for Brexit.

More than that, “we are optimistically confident for the future”, he says.