Midlands manufacturers adopting sophisticated strategies to boost exports
MIDLANDS manufacturers are adopting a wide range of strategies to take advantage of escalating demand in emerging markets, a new study has concluded.
The report and analysis of data, published by manufacturing organisation EEF and Barclays, suggests companies are looking to tap into the potential opportunities available within these new markets, many adopting sophisticated export strategies in the process.
It said whilst the developed economies remain the top destinations for UK manufactured goods, smaller companies were adapting to take advantage of growth opportunities spanning every continent.
The report shows that some manufacturers looking for future growth are becoming more strategic in their pursuit of new customers by proactively targeting markets rather than reacting to potential opportunities. Others are building greater resilience by expanding the number and range of markets they sell to.
It also highlights some of the challenges firms are likely to have to overcome in order to be a success in the new markets, such as establishing long-term supply relationships with customers.
“While this process can take time to deliver results, it is these efforts that will help to sustain a stronger and more balanced recovery for the UK,” said the report.
However, the report also highlights that while companies are making use of government support, and rate it highly when they use it, there is continued lack of awareness about the breadth of expertise and help available.
In response, EEF is urging Government to step up efforts to market these services. EEF and Barclays have also published their own guidance taking companies through the process of entering new markets.
Richard Halstead, Midlands Region Director at EEF said: “There are no hard and fast rules about the best way to enter new markets. But what is clear is that it demands considerable time and commitment.
“However, those companies who generate results are ultimately rewarded with better performance and a diverse and resilient customer base. If we are to double our exports by 2020 then we simply have to get more and more companies exporting, helped by a government led crusade highlighting the benefits of UKTI.”
Mike Rigby, Head of Manufacturing at Barclays, added: “It is encouraging to see an increasing appetite amongst manufacturers to invest, export and grow their international footprint.
“If the sector is to be at the forefront of an export-led recovery, it appears manufacturers are up to the challenge. They not only realise the benefits of exporting to markets nearer home but also, of taking their goods further afield to faster growing emerging market economies where the export sales potential is far greater. This does require a lot of preparation and know-how but fortunately there is plenty of help around so they won’t have to embark on their export journey alone.”
According to the report, the developed economies remain the top destination for UK goods with the US the biggest. However, the increasing importance of emerging markets is highlighted by the fact China has moved from being the UK’s 11th largest market in 2007 to 7th last year with Russia and India (12th and 14th respectively) likely to enter the top ten in the next few years.
It also shows half the countries in the top ten priorities for manufacturers were emerging markets with Brazil at the top with just under one third of companies planning to export there in the next 12 months.
It said while the Eurozone remained the top destination for market involvement in 2013, almost two thirds of companies were planning to increase their involvement in Asia, just over half in the Middle East and just over one third in both Africa and South America.
