Smaller Businesses Struggle with High-Growth Markets
A new survey by the British Chambers of Commerce (BCC) shows that smaller firms need more government support to help them trade with high-growth markets. The survey of more than 8,000 businesses suggests that UK exports are held back by a focus on traditional markets, such as the EU, at the expense of larger, faster-growing economies.
When asked where they export to, 88% of respondents sell their products or services to the EU. This compares to 47% of businesses that export to BRIC countries (Brazil, Russia, India and China), and 55% to other Asian and Middle-Eastern markets such as Thailand and Saudi Arabia.
However, while nearly three-quarters (73%) of large firms trade with BRIC countries, only a third (32%) of micro firms do business in these markets.
John Longworth, Director General of the BCC, said,
“Britain has the potential to be a great exporting nation. The Government must work together with business to unlock the potential of Britain’s exporters, who will in turn help to drive the economic recovery.”
“More and more UK businesses are taking their goods and services overseas, but many still face obstacles when trading internationally,” he adds. “Smaller firms in particular can find it difficult to break into newer, emerging markets, such as Brazil, India and China.”
The survey identifies the main barriers that are potentially holding small businesses back when it comes to trading with high-growth countries — regulations and export tariffs.
The BCC is now calling on the Government to take action. It is asking for:
- Improved targeted support from UK Trade & Investment (UKTI) for SME exporters to access the fastest-growing markets;
- The opening up of new markets through free trade agreements;
- The re-establishment of foreign languages as core subjects within the UK national curriculum and in workplace training
Small businesses wishing to start trading abroad should take a look at our export business advice articles.