Region’s mid-sized businesses target new international trade routes despite tariff uncertainty
Expanding or exporting overseas is a top priority for more than a third (38%) of South West mid-sized businesses over the next year, despite complex international trade conditions.
BDO’s Economic Engine survey of 500 mid-sized businesses shows that companies in the South West plan to target territories such as South America (50%), Australia (50%) and Africa (47%). Europe also remains a healthy market, with 44% focusing on the European Union in 2025. A further 35% intend to target those countries that sit outside the EU, including Norway, Switzerland and Iceland.
Mid-sized businesses, which generated £1.6 trillion in turnover last year, are continuing to push for growth through international trade despite grappling with supply chain pressures. This includes uncertainty around tariffs in receiving countries, delayed deliveries or a shortage of the skills needed to support overseas exports.
According to the BDO survey, more than a third (38%) of South West businesses face skills shortages in export operations or supply chain management teams at a time when they hope to grow overseas trade.
Mounting pressures come as demand from end consumers slows for products and services. Nearly a third (32%) say lower demand from consumers, which could include from businesses with elevated operating costs or consumers with high living expenses, is one of the challenges they face over the next six months.
Despite these headwinds, South West mid-sized businesses are working to tackle the challenges they face and remain optimistic. Ahead of the Government’s plans to publish a Small Business Strategy later this year, all South West businesses surveyed (100%) expect the strategy’s focus on growing smaller firms to benefit them.
Of this number, nearly one in six (15%) are calling for measures to reduce red tape, including reforms to streamline customs procedures, which impact the export of products and services overseas, or offer stronger support for exports and trade, including more dedicated UK Export Finance funding.
These businesses may be buoyed by the Government increasing the amount some companies can borrow from the British Business Bank’s Growth Guarantee Scheme or UK Export Finance’s Export Development Guarantee, as they grapple with the prospect of new tariffs in some receiving countries.
David Brookes, regional managing partner at BDO in the South West, said: “Although economic conditions remain challenging, mid-sized businesses in the South West are highly ambitious and have their sights firmly set on driving growth, with overseas trade playing a central part in helping to realise those ambitions.
“The forthcoming Small Business Strategy is one of many major opportunities for the Government to provide targeted support for the mid-market – support that will complement efforts being driven by the region’s Metro Mayor and combined authority, with the aim of reinforcing the South West’s role in the UK’s economic landscape.”
