A new report published today by the Chartered Institute of Marketing, in association with PwC Research, warns that the UK’s small and medium-sized businesses are naïve to the exporting challenges created by the country’s exit from the EU.
The report, Export Ready, backed by politicians and senior marketing professionals, reveals that seven in ten UK exporters expect to increase exports over the course of the next three years. Yet the majority of those interviewed have failed to develop a specific export strategy and are instead passively waiting on requests from existing customers.
The warnings echo the Office for Budget Responsibility’s recent prediction that Brexit will depress Britain’s export market share. Key findings from the Export Ready study include:
· 70 per cent of exporters anticipate an increase in exports over the next three years. Only 4 per cent of existing exporters say exports will decrease.
· Yet only a third of exporting businesses (34 per cent) say they have an export strategy.
· Businesses with an export strategy are more confident they will increase exports and that they have the skills to sell in new markets.
The research also finds that, despite measures from Government to encourage businesses to increase overseas trade, only around one in seven non-exporting firms plan to consider doing so.
A shocking 59 per cent stated they are “very unlikely” to consider exporting in the next three years.
Chris Daly, CEO, Chartered Institute of Marketing said:
“With Brexit approaching our research has uncovered a worrying level of complacency from British business. Too many firms appear to be crossing their fingers and hoping exports will continue to grow. Without a clear strategy to break into new markets, business is in for a shock when the UK leaves the European Union. These findings must serve as a wake-up call for businesses to think again on how they make themselves export ready.”
Skills gap bigger barrier to exports than tariffs
The research explored the main barriers to UK businesses seeking to export their products and services; finding that successful exporters identify a lack of skills and know-how as greater barriers to exporting than tariffs:
· 40 per cent of businesses said that having the know-how to adapt their marketing strategy to unfamiliar cultures and markets was a major exporting challenge.
· A quarter (26 per cent) said they struggled to access the right marketing skills.
· A third (33 per cent) said they lacked confidence in approaching new markets.
· Only 13 per cent said that off-putting tariffs were a problem.
Baroness Fairhead, Minister of State for Trade and Export Promotion: “Although UK exports have grown to represent 30 per cent of the UK’s GDP, this figure remains lower than that of other nations in Europe and close to 90 per cent of UK businesses do not sell their products and services overseas.Marketing professionals have invaluable understanding of the trends and operation of overseas markets and can help companies at every stage of their export journey to
capitalise on opportunities to sell abroad.”