SMEs advised to test export markets before committing
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SMEs in the Midlands should capitalise on opportunities to export and look for ways in which to test overseas markets before investing significant funds up-front, advisors have said.
Paul Norbury, partner and regional private business leader at PwC in the Midlands, said: “There is a significant fear factor among small and medium-sized businesses when it comes to exporting for the first time and a perception that only larger organisations have the resources to do so.
“In actuality, there is a wealth of private businesses in the region that are successfully exporting to the US and BRIC economies for example, where GDP growth rates are higher than here.
“While there are successful exporting operations in existence, established through diligent market research and risk analysis, private businesses are right to be cautious and should start by taking some simple steps to quantify market demand for their product or service before investing for the long-term.”
He said some of the ways in which private businesses could test the export market while minimising their exposure to risk, was by translating their website and launching it locally. Companies may also appoint an overseas distributor or agent to promote their products and services and employ a foreign PR company to drive awareness, he added.
“Privately-owned businesses often believe they have more to lose than larger corporates and are acutely aware of the financial risks they are taking. They don’t always have the resources or the people power to manage their exporting activity effectively, so research prior to market entry is especially important and will allow them to control risk, time and spend.
“Sounding out the options before making a move is important but private businesses should know that by being nimble and responding to the growth opportunities that exist, they can increase their profits well beyond domestic market expectations,” said Mr Norbury.