Are exports and productivity linked for SMEs?
Boosting UK exports could potentially have a knock-on effect on productivity according to a new report, enhancing the nation’s economy in the process.
TheCityUK’s study into how best to enhance export abilities suggests that fulfilling export potential among small businesses could bring a wide range of benefits.
Their reasoning behind this is because the proportion of SMEs that export in the UK is below the average for the European Union – one in four compared to one in five.
Mid-sized firms were found to lag further behind so it is suggested that exporting goods, innovations and technology could become a driving force for the economy.
In the report, it is stated that SMEs require a greater awareness of the support schemes on offer from the government and of alternative financial support solutions.
Firms who already export heavily to Europe and beyond were found to have far greater productivity levels and were noticing more success as a result.
There are a number of financial sources that can provide the necessary money to achieve this, but it’s also important that SMEs do not try to operate beyond their means.
In the initial stages of expansion, many can try to take on too much or to expand too quickly, which can place them under financial strain.
It is very easy to overspend in such a situation and a firm could be left facing the serious threat of corporate recovery if not managed properly.
The report suggests that the Government should build stronger relationships with firms by providing access to information and guidance that can help them to export and expand.
This should help drive long-term economic growth while it is imperative that the nation’s small businesses are made aware of the potential benefits of exporting goods on a large scale.
With innovation widespread across the UK, a number of opportunities exist for companies, provided they approach the situation in the right way.
By Phil Smith