We need to encourage and promote our dynamic trading SMEs
28 October 2018
If the UK is to seize the opportunities of Brexit, it should look to its small business exporters
Last month the British Chambers of Commerce welcomed hundreds of business people to a major exporting event. It was encouraging that despite the uncertainty over the future of international trade agreements, post-Brexit many firms are looking to expand their reach into new markets.
Our research shows that firms which export are more likely to be innovative and dynamic than those who trade solely in the UK. 65 per cent of internationally active firms have launched a new product or service in the last year, compared to 41 per cent of those who don’t trade with other markets.
That being said, official data has shown that our export performance and trade balance is not where we as a country want it to be. This is of course in large part due to ongoing uncertainty over Brexit and the exchange rate volatility we have seen since the EU referendum, which has benefitted some exporters but been a hindrance for importers or those with connected supply chains.
While Brexit presents unique challenges, to be successful, a great global trading nation needs to encourage and promote its trading companies. This requires several things. It needs a trade mission programme planned years, not weeks, in advance, with much more focus on building supply links and networks rather than big-ticket “headline” announcements from large firms. Trade missions should also have a large SME component. All too often it is the same large, multinational corporations invited to attend. SMEs – dynamic businesses who are so integral to supply chains but often lack the resource to build the connections – are often left behind.
It also requires on-the-ground support, both at home and in markets overseas, as a point of contact and advice for firms looking to export. Chambers of commerce do their part, with our network of over 40 accredited chambers in key markets across the world, who can make connections for those looking to start trading in a new country. The recent naming of two HM trade commissioners by they government is a positive step in this regard. It’s important they focus on plugging gaps in the system and working with existing players, such as chambers of commerce, rather than trying to reinvent the wheel.
It is a concern that the government resources spent to promote UK trade overseas has been decreasing year-on-year, at a time when it wants to push the image of “Global Britain”.
British SMEs will feel confident in opening up to international trade if they can see a long-term approach from government and are actively supported to build connections and boost supply chains.
There are also steps the government can take on the domestic front that will make a real difference. By boosting the UK’s physical and digital infrastructure – the fundamentals of the UK business environment – our SMEs will be given the confidence at home to take risks overseas.
UK firms are resilient, and have experienced uncertainty before. But if the UK is to become an even greater success story, then support for SMEs and a long-term approach to trade promotion will give firms of all shapes and sizes the confidence to take risks, break into new markets, and show the world that the UK remains a fantastic place to do business.
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Hannah Essex is Co-Executive Director of Policy and Campaigns at the British Chambers of Commerce