It’s been a turbulent year for British entrepreneurs. Stagnating wage growth coupled with a fall in consumer spending has taken its toll with both business and consumer confidence slipping to record lows over the long summer. Whether its looming interest rate rises, weak productivity or currency volatility, it has been a tough environment to run a company in 2018 and many big names from House of Fraser to Gaucho falling casualty to these testing times.
Despite all this, British business leaders have pushed ahead, looking for growth opportunities where they can be found. Research from WorldFirst’s recent Global Trade Barometer found that more UK SMEs are trading internationally today than last year. Almost a third or 32% of all SMEs made at least one foreign transaction in the average month over the last quarter, a 6% increase from the previous quarter. In real terms, it means 1.8 million SMES are now doing business abroad.
Not only are more small businesses trading internationally but the average values of trades has also risen to record highs. On average, UK SMEs made transfers of £47,000 each month which represents a 25% increase in average transfer values compared to the same period in 2016. All in all, UK SMEs engaged in approximately £84bn worth of sales each month in the las quarter.
This openness to trade has been key to the UK economy narrowing its trade deficit and it is no wonder that international trade secretary Liam Fox is keen to promote this recent positive news as a prime example of British business defying the odds of Brexit.
It makes sense that in these uncertain times, UK SMEs are looking for opportunities abroad. With official statistics revealing the UK as the slowest-growing advanced economy on earth, consumers’ belts have tightened so businesses most look elsewhere for sales prospects. Exporting offers UK directors the chance to grow their business in new markets, diversify their customer base, therefore minimising the potential risk of a downturn in the local economy on their bottom line. Furthermore, it has never been easier to trade internationally.
Technological advances over the last decade have meant businesses can market their products to foreign clients online with ease. The popularity of online marketplaces like Amazon, eBay and Alibaba makes the process of selling to customers from Seattle to Shanghai very straightforward and there are also tons of logistic services to help you get your goods or service into your buyer’s hands quickly and securely.
However, we find that many business owners are still hesitant to take the plunge and start doing business overseas despite the potential rewards. 43% of respondents to WorldFirst’s Global Trade Barometer revealed that they did not anticipate any international growth in the near future. This is not due to a lack of ambition as many identified they would like to export but lack the resources to do so. Almost half of decision makers agreed that external help would support their export ambition.
Help is available for businesses looking to grow overseas though and many just need educating on where to find it. Trade advisors from the Department of International Trade are on hand to provide valuable insight into approaching new markets and there are many support services available to help you get started.
And for every challenge you face in your export journey, there will be ways to get around and push further. For example, 39% of business decision makers were worried about currency volatility and the impact it could have on their business. But with platforms like WorldFirst’s World Account, which offer a fast, free way to open local currency accounts around the world, managing your currency exposure and international payments has never been easier.
It’s a particularly good time to start selling internationally as the weak pound means British exports are now more competitively priced overseas. In fact, many big brands like Asos and Burberry have seen a sales boost due to sterling’s recent weakness and there’s no reason small businesses cannot benefit as well.
This article comes courtesy of WorldFirst, the experts in moving money around the world.