3 August 2015 15:00
SME export growth helps reduce UK trade deficit
Published as part of the second annual FedEx Great British Export Report 2015, research suggests British SME export activity is helping to reduce the UK's overall trade deficit, which still stands at about £2.8bn.
According to FedEx, 53% of British SMEs now export, but 72% believe their export revenues will increase in the next five years.
The report, which is based on feedback from 1,000 UK SMEs, found that: "The average SME exports £553,000 a year to Europe and imports £535,000, an average net surplus of £18,000 for those SMEs exporting to European countries. The average SME exports £714,000 a year outside of Europe, but imports just £410,000, an average net benefit of £304,000 for those SMEs exporting globally."
FedEx's research suggests that overwhelmingly (96%) of British SMEs who export, export into Europe. France (57%) is the number one export market for British SMEs, followed by Germany (49%) and Spain (37%).
Nearly three quarters (73%) of British SME exporters sell to customers outside of Europe, with the US (35%), Australia (24%) and Canada (20%) being key markets. 16% of exporting British SMEs sell to China, with emerging market Brazil also scoring highly (10%).
The research suggests that more than half (58%) of all British SMEs would appreciate more support (whether from trade bodies, the Government or logistics providers) so they can sell more overseas. Only 22% said they require no further support. Top barriers to international trade included costs, losing out on currency exchange and payment concerns. However, the ability to enter new export markets is seen as critical by fewer than one in five respondents.
Trevor Hoyle, FedEx Vice President Northern Europe Operations, said:
"The findings clearly show that UK SMEs are exporting more than ever, both in terms of volume and value. There is, however, more to be done.
"While the top destinations for exports are in Europe and the English-speaking world, British SMEs are starting to notice the potential in the high-growth markets of Asia, Africa and Latin America. As the world becomes more connected, global trade lanes will strengthen, and exporting to these markets will be even easier and faster. A year is a long time in business, but don't be surprised to see UK SMEs' exporting confidence continue to grow in the next 12 months."