According to the Federation of Small Businesses (FSB), the number of SME exporters in Britain could double in the next few years – provided that they're given more support to navigate potentially tricky waters.
Growing interest in exports
A recent FSB survey revealed that 21% of small UK businesses have exported their goods over the past few years. This figure is matched by the 21% of firms that said they were interested in exporting, meaning there is potential that the number of SMEs selling their goods overseas could increase twofold.
According to the FSB, the average turnover of a company that exports is £935,921 – more than twice the average revenue of companies that don't (£390,028). The FSB believes that this is a big opportunity which should be supported by the government, the finance industry, the private sector and business associations.
The challenges
Small businesses preparing to enter the export market have a few obstacles to overcome. At the basic end of the scale there are language barriers, foreign VAT and tax laws, and currency exchange issues. At a higher level there’s the uncertainty that comes with the changing export market (particularly in the wake of Brexit) and the pros and cons of e-commerce. There's also the issue of identifying and advertising to new customers in unfamiliar markets. It is the FSB's opinion that small firms lack confidence in navigating these challenges alone and are uncertain of where to turn for support.
The EU issue
Around 93% of small British exporters currently trade with countries in the EU. In the wake of the Brexit vote, the FSB has been vocal about the need for the government to issue reassurance. Martin McTague, the FSB National Policy Director, said: "(we've) clearly and consistently called for clarity on what the UK's exit from the EU means for business, with particular emphasis on access to the single market and the free movement of people and trade."
In the short term, however, there are some benefits. The reduced value of the pound has made British products slightly more competitively priced, potentially encouraging more customers.
