Any businesses with ambitions for growth can recognise the benefits of reaching out to new markets. As more UK SMEs look to shore up their growth plans by looking across international borders, what’s driving the trend?
SMEs across a wide variety of sectors are eyeing business growth by expanding their customer base through establishing connections overseas. It’s not only set to give them a chance to export to new markets but could help them reduce costs by working with new suppliers and give them access to a whole new talent pool. With so much gloom and uncertainty around the UK economy, the optimism of SMEs might seem surprising. But there are a number of different factors influencing the shift.
Brexit put a spotlight on international trade
While Brexit has led to uncertainty on export opportunities with other members of the bloc, it’s also highlighted just how important international trade is to SMEs. At the moment, only around one in five SMEs export, with the EU a trading partner for some 85%. However, with increased awareness of international trade and a need to diversify, more SMEs are exploring the benefits of looking beyond the borders of the UK.
Awareness that red tape isn’t as bad as feared
One issue that holds SMEs back from taking the plunge into international waters is the fear that the process will be overly complicated, and they’ll face huge amounts of red tape. It’s a process that can actually be fairly straightforward, as more small and medium sized firms try their hand at exporting, it has a knock on effect on awareness.
Growing business confidence
Despite all the uncertainty, overall business confidence is slowly growing, and more firms are planning for growth in the future, which naturally leads to some looking abroad. A recent survey from Lloyds Bank showed that despite an economic slowdown early this year, overall business confidence increased by three points to 35% and over a third of firms expect Brexit to have a positive impact on their business.
Improved technology making communication effortless
Just twenty years ago it would have been hard to imagine how easy it would be to communicate on a global scale. Technology is rapidly coming down in price, making it easier than ever before for UK SMEs to forge effective working relationships with other businesses and customers almost anywhere on the globe. Technology developments are breaking down barriers for international trade.
Here at GIC Capital, we provide practical, flexible financial solutions for SMEs that want to achieve their full potential. If you’ve got ambitions of reaching a whole new market and just need the capital to turn it into reality, contact us today.