Many opportunities for UK SMEs on the global stage Stephen Maher is CEO of MBA - one of the World’s Leading Independent Agencies whose clients include Mercedes Benz, Accor Hotels and Embraer Executive Jets
With so much (Olympics aside) doom and gloom out there, many British businesses may be keen to explore opportunities outside the flat Eurozone in order to grow and ensure they stay on track. Statistics from UK Trade and Investment show that companies that take the plunge and secure sales abroad improve their productivity by 34%. They are also 12% more likely to survive and excel than those who don't.
Successive UK governments have sought to encourage more businesses to do business overseas. Despite this, only around one in five SMEs in the UK trade overseas compared to one in four in the rest of Europe. Government figures suggest that if the UK was able to match the European average, it would inject an additional £40 billion into the economy. And indeed with 2 billion people now online, overseas markets have never been more accessible.
Many pitfalls await
Making the decision to break into new international markets can be daunting. Researching and getting beyond the cultural veneer of a new market from afar can test a smaller business’s resources – larger corporates (the competition) could have phalanx of internal specialists and consultants carrying out these arduous and costly tasks. Differing regulatory environments and tax laws need to be navigated and just managing the foreign exchange smoothly can be taxing to say the least ( in a recent study by HSBC, 33% of international UK businesses cited dealing with foreign exchange as their biggest challenge when trading internationally). There are new costs to budget such as travel when emails, ftp’s and Skype do not suffice. There are many practical issues to confront, such as due diligence on potential partners and galvanising effective on the ground sales and marketing. UK based banks can be a good source of initial free advice in many of these areas as well as UK Trade & Investment who can help conduct local market research or suggest local advisors. Grants may also be available.
Global branding works
Having said all this, the core principles of successfully doing business and why people buy and sell do not fundamentally change and our new e-commerce world just made it a whole lot easier to reach all these people with scale. Just look at companies like Apple, Mercedes, Tesco, Accenture and the like – they are trusted brands with great ‘offers’ that have an edge in all markets and people the whole world over want them. Yes, it is important to understand trends and differences in culture in order to appeal to varied customs and practices across the globe. Successful global brands have tapped into universal truths of consumer psychology and have applied this to their campaigns.
Great Britain is good for business
Also we should celebrate and exploit our ‘Great’ British heritage in business success, relationship building and beyond. No arrogance or exploitation or assumptiveness welcome of course but the UK has been exporting successful locally grown assets for centuries – whether it is soccer or golf, or Burberry or jet engines. As was shown at the recent government series of Olympic Global Business Summits – where I had the pleasure to present on the strengths of the UK in the Creative Industries Sector – we are recognised positively by many the world over for applying professionalism, innovation and drive in many areas of commerce. London also offers one of the most compelling hubs for businesses of any size looking to grow internationally ( London and the South East is also the most popular destination in the UK for foreign owned businesses - according to the Thames Gateway, almost one in three foreign-owned firms in the UK are based in these cities). At MBA we have seen the power that London can bring, where we work from our office in London as the global marketing communications agency hub for Embraer Executive Jets – one of Brazil’s largest exporters - who selected us partly because of London’s globally renowned creative spirit, its cosmopolitan outlook and its time zone benefits.
So maybe we just need to be a little more un-British and less backward in coming forward in exploiting our strengths. There are vast opportunities out there for SME’s as much as larger corporates with markets untapped and with growth prospects greater than 0.5% p.a. And while the pitfalls are real and need to be truly embraced, in many ways it is all just the same but different.