Region’s businesses plan export surge
More than half of Cambridgeshire’s mid-sized businesses (MSBs) expect to increase export levels over the next 12 months despite facing barriers to international success. Grant Thornton’s definition of an MSB is a company with 50-499 employees.
A poll conducted by the business adviser found that 51 per cent of MSBs were gearing up to grow their current overseas business during 2015, with a further nine per cent saying they plan to begin exporting for the first time.
Forty-five per cent said they were considering breaking into new overseas markets in the next 12 months with an additional 28 per cent saying it was a possibility.
The most popular territories for future expansion cited were mainland Europe (33 per cent) and the US (14 per cent), while nine per cent of businesses equally stated China, Brazil and India as potential targets.
Paul Naylor,(pictured) practice leader at Grant Thornton’s Cambridge office, said: “It’s encouraging to see such a large proportion of our county’s MSBs with a firm eye on international business and confident about future exporting.
“Last year, export sales in the East of England increased by 4.5 per cent but with growing instability in the Eurozone, the strength of the pound, a general election coming and business confidence levels slowing, this rate of growth may be difficult to match in 2015.
“A step change in mindset is needed from whichever party or parties take residence in Downing Street. This must include considerations for supporting our businesses in new markets abroad, particularly where demand for ‘Brand Britain’ carries a premium. Only this will ensure a long-term, sustainable and diversified business environment.”
Quizzed about the main barriers to doing business abroad, 42 per cent of respondents said overseas legislation and regulation were key challenges. A further 23 per cent cited cultural and language difficulties as issues with almost a quarter saying it was difficult to find the right workers abroad to take the business forward.
Encouragingly, more than a third of Cambridgeshire MSBs polled said they used a support organisation such as UKTI to help with overseas business and 17 per cent said they would consider doing so in the future.
Paul Brown, associate director at Grant Thornton Cambridge, added: “A Grant Thornton report (‘Agents of Growth’) shows that UK MSBs have been outperforming other businesses when it comes to export growth.
“However, many still remain apprehensive of ventures into overseas markets, fearful in particular of regulatory and cultural barriers.
“But the agility of MSBs actually puts them at a competitive advantage, making them very well placed to overcome those challenges and seize the opportunities in high growth markets.
“The vast majority of MSBs looking to expand internationally tend to be focused on Western Europe and North America but it’s worth exploring beyond these regions to capitalise on higher growth areas such as India, China and South Africa. With the right support, the rewards could potentially be even greater.”