Export 2012 Seminar: Riskier business but limitless opportunities

SPEAKERS at the Barclays/TheBusinessDesk.com Export 2012 Seminar advised would-be international traders that the opportunities in overseas markets are almost limitless.

But they also highlighted the difficulties in accessing distant markets for SMEs.

The event at the Latitude Club at Barclays’ One Snowhill headquarters in Birmingham, was attended by SMEs keen to know how to go about exporting their products and services.

Neil Fewtrell, relationship banking director for Barclays Business in the north Midlands, said: “No matter where you look everyone appears to be telling us that exporting is the way forward for the UK economy.

“At Barclays we agree with that. We think there is a tremendous opportunity for UK SMEs to seize exporting as a way forward.

“We did some research with Kingston University which showed that a third of those that had entered the export markets experienced bottom line growth in the first six months and 80% of them experienced bottom line growth within two years.

“Businesses that had gone into the export markets also reported other benefits such as improved productivity, extended product life span and gaining confidence as business owners.

“But it can also be a daunting prospect if you have never done it.  But I would suggest these are not reasons to exclude it.

“There is a lack of confidence about how to take the first step and where to get advice.

Barclays’ role in this is as a facilitator and to back this up with products and services.”

Fewtrell revealed new Barclays’s new Business Abroad scheme – a range of products and services to support exporters – has seen 3,000 customers sign up to the concept in the first six weeks.

Experienced exporter Peter Mathews, chairman of Black Country Metals, told the audience that exporting is fun and in difficult times it can help a business to survive and thrive.

“The global market today has changed. When I started we didn’t export anything. We didn’t need to export anything until the early ‘90s,” he said.

“Today 97% of our turnover is on the export markets.

“The European market is no longer our main market for obvious reasons.  We concentrate on the markets of Asia in particular and the growing markets of South America.”

Mathews admitted there are barriers to exporting.

“Some of the paperwork and legislation is unbelievable,” he said.

“For me to export from the Black Country to India I have to have a European document.

“In other countries, such as Russia, the barriers are there and in China I need a licence from the Chinese government to trade and I have to go to the expense of being inspected in the UK by one of their agencies.”

Mathews advised novice exporters in the audience that it is important to understand the culture of the people with whom you are doing business.

“We don’t always do our homework properly,” he said.

“Most exporters don’t engage with UKTI; they just go straight to the market. And it is the only real organisation supporting international trade.

“Sometimes we sit on our hands and expect the market to come to us.  We can’t afford to be parochial any more.

“We need to be seen as the most reliable business partner in the world.”

Adrian Bailey, Labour MP for West Bromwich West and chairman of the parliamentary business, innovation and skills select committee (right), said uncertainty in the Eurozone has created a fear amongst potential exporters whilst the squeeze on consumer spending at home means many companies don’t feel confident enough to increase their capacity and level of investment to make the most of export markets.

“The BRIC countries offer big opportunities but there are significant cultural barriers there and many of these countries, quite understandably, want to make sure the companies they use from overseas actually contribute to their local economy,” he said.

“Many of them either want joint venture companies or to see a registered office.

“The major companies are very successful exporters to BRIC countries but the difficulty comes for small and medium-sized businesses with no experience of exporting there.

“They may have first class products but they are desperately trying to survive on a day to day basis and don’t have the capacity to take on board the necessary commitment to penetrate these markets.

“But there are huge opportunities in China for tier one, two and three automotive suppliers to access and there are huge opportunities in aviation. To a lesser extent that is represented in Brazil and other countries as well.

“What we have got to do is get the capacity in this country.

“We also have to get it right through UKTI and other agencies so British businessmen understand the cultural situation in the country they will be exporting to.

“Provided we get it right the opportunities are almost limitless.”

Robbie Beak, an adviser at UKTI in Birmingham, told the audience that help is very much at hand.

“UKTI has an office in pretty much every country we trade with and they are populated by people who know these markets,” he said.

“UKTI is not a good source of funds and grants but you can get little bits to mitigate the risks of trading.

“If you want to access a new market you can visit as part of an organised trade mission and our export marketing research scheme will pay 50% up to £500 for research of this kind.

“You can also exhibit at a trade show in the target country and there is funding towards taking a stand there.

“And you can also get embassy staff  to make meetings for you. You have to pay for it but it is heavily subsidised.”