The number of medium sized businesses receiving UK Trade and Investment (UKTI) support to sell overseas has doubled in just 7 months from 1,000 to more than 2,000, UK Trade Minister Lord Livingston announced.
In April 2014 Lord Livingston wrote to every medium sized business in the country offering them tailored trade advice and an intensive programme of support from UKTI to help them start exporting or break into new markets.
Medium sized businesses are vital to the government’s long-term economic plan to reduce the deficit and create more jobs. The CBI estimates that if they reach their full potential, it would be worth £20 to £50 billion to the UK economy.
However only 17% of UK medium sized businesses generate revenues outside of the EU compared to 25% in Germany and 30% in Italy.
On Monday Export Week starts with events across the country.150 UKTI trade advisors from embassies around the world are in the UK to provide expert advice to both small and medium companies.
Last month (October 2014) UKTI announced that it had increased the number of businesses it supported by 50% to almost 48,000 businesses in 2013 to 2014. The vast majority of these firms were small businesses.
Trade Minister Lord Livingston said:
“By reaching more international customers our medium sized businesses can become the next Vodafone, Unilever, or Jaguar Land Rover.
“I would like to see British firms exporting just as much as companies from Italy and Germany so I am hugely encouraged by the ambition of our newly recruited firms. By the end of this year I want to treble the numbers receiving support so that we can overhaul our international rivals.
“Companies do better with UKTI support, receiving advice on over 100 markets around the world, introductions to new distributors, access to finance, help to sell online and much more.”
Of UKTI’s new medium sized customers almost half are from 5 sectors:
•construction –116
•food and drink – 111
•business services – 104
•mechanical electrical and process engineering – 74
•automotive – 67
Medium sized companies succeeding with help from UKTI include Surrey Satellite Technology who generate 99% of their revenue through exports; Caribbean food supplier, Grace Foods UK, from Hertfordshire who have increased export activity by more than 50% over the last 3 years and Pavers Shoes from Yorkshire who have expanded from 35 to 100 stores in India.
A recent poll of 1,100 small and medium sized businesses published by KPMG and YouGov found more appetite for expansion overseas among medium sized businesses than smaller enterprises, with just 1 in 5 expressing no interest in exploring foreign markets at all.
The research cited a lack of understanding of international markets and perceived complex legal requirements as businesses’ main export challenges – both issues that UKTI provides help and advice with.
Kevin Smith, who heads up KPMG’s mid-market practice in London said:
“It is not surprising that after the recession some small and medium sized businesses are being cautious and choosing to focus solely on the domestic market in the UK, but it is shortsighted given the huge appetite for British goods and services abroad.
“Making the leap into overseas markets is not nearly as daunting as it seems on paper. There are some great success stories of businesses who have achieved massive growth by successfully exporting to overseas markets using the government help available through UKTI.”
Helping medium sized businesses is good news for small UK companies too: 70% of their supply chain comes from our domestic economy.