Nearly three quarters (71%) of the UK’s major businesses expect to enter new overseas markets during the next five years, according to new research by international spend management company, Proactis.
By doing so, major companies expect to secure crucial growth opportunities, possibly in mitigation for stagnant domestic growth or rising economic headwinds. On average, major businesses expect to increase revenue by 22.5% over the next five years through overseas expansion.
With great disruption in Eastern Europe due to the Russia-Ukraine conflict, UK businesses may be pressed to refocus their export plans for that region into other markets. Around 19% of major UK businesses had expected to expand into Central and Eastern Europe prior to the conflict – and may now need to look further afield.
The Proactis research also shows that Western Europe is the top target for UK businesses. Some 39% of major businesses say they will export to that region for the first time this year.
Tim Sykes, CEO of Proactis, said, “There is a sense of positivity about international trade, but while UK firms continue to seek out expansion opportunities, the one in five that were considering Eastern Europe as a prospective market will now have to look elsewhere.”
According to the Proactis survey, the Americas (12%), Asia (11%) and Middle East (11%) are the next most popular export targets for British businesses, suggesting the outcomes of trade discussions between the UK Government and the likes of the US and India could significantly influence the ability of these businesses to reach their export ambitions.
However, with nearly nine in ten (87%) businesses reporting that increased use of digital technologies has improved capacity to trade internationally, Proactis says digitisation may help UK businesses reach their goals.
Sykes, added, “The cost of doing business is rising significantly while supply chain shortages, the pandemic and the Russia-Ukraine conflict impact opportunity and confidence. Increased exports could provide green shoots for many businesses, but they must be supported to do so.
“Our research shows that digital transformation is playing an important part in helping businesses improve their ability to trade internationally.”