If you haven’t yet considered trading internationally, here are five reasons why exporting could boost your business ambitions.
Research by Capital Economics for UK Export Finance (UKEF), the UK’s export credit agency, shows that companies with only domestic customers grow less than those that export abroad.
Out of more than 1,000 UK SMEs surveyed pre-pandemic, businesses with purely domestic customers reported annual growth of 8.4% over the previous 5 years compared to as much as 15.2% for those which export.
Half of exporting firms said exporting had boosted profits by up to, or even more than, 20%.
A 2022 survey by Kent Business School as part of the SME Internationalisation Exchange Project found that 11% of firms had used exporting as a strategy to build resilience and increase growth and have started to export since COVID-19.
In 2021, Britain launched its revised export strategy Made in the UK, Sold to the World with an ambition to reach £1 trillion in exports annually.
Through the European Regional Development Fund (ERDF), the Internationalisation Fund is providing 7,500 SMEs in England with financial assistance to internationalise.
The government is also exploring trade with new partners, including free-trade agreements in Australia, New Zealand and Japan, agreements in developing nations such as a £1.7 billion opportunity in Peru, and accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Why your business will benefit from more than growth
Businesses trading overseas experience higher productivity, and are more likely to innovate.
UK businesses which declare international trade in goods are around 70% more productive on average than non-traders. (ons.gov.uk)
85% of companies say that exporting has led to a level of growth not otherwise possible. (Source: export.great.gov.uk)
66% say that trading overseas led them to fresh business ideas and innovation. (Source: ICAEW)
Why you're ready
If you can answer yes to these questions, your business could be ready to start trading overseas:
Can your production cope with increased demand?
Do you have enough people with the right skillset?
Can you extend your processes and controls?
Are you prepared to increase your trade and cashflow cycles?
Do you know which markets you should target?
Have you researched your key markets and formed an export strategy?
Why HSBC can help
Whatever stage you’re at in your exporting journey, we can help.
In a difficult macroeconomic climate globally, it can be daunting for businesses to find new markets. We offer on-the-ground support in 50+ countries, growth solutions and a global network to help customers to build their business.