Domestic market: does it hold the key to growth for SMEs?
Opening up a business to overseas markets is always seen as a sure-fire way to tap into additional sources of revenue, as well giving a business the chance to compete in the global marketplace.
As a result it is no wonder that so much emphasis has been placed on supporting businesses, and especially SMEs, in building up the export side of their operations. UK Trade & Investment recently announced that it will be introducing new funding rules to designed to help small and medium-sized businesses (SMEs) participate in more overseas trade fairs.
Online auction site eBay has also recently outlined that it will be creating shops on overseas eBay sites in order to help thousands of SMEs trade successfully abroad.
Recent figures have also demonstrated the boost to the economy that exports provide, with British food and drink exports alone having grown to almost £19 billion.
However, while a focus on overseas markets could definitely be a move in the right direction for many businesses, it seems the domestic market represents the immediate future for many SMEs.
According to the latest Close Brothers Business Barometer, nearly two-thirds (63%) of SMEs feel that the domestic market presents one of the greatest areas of growth potential for their business.
Yet despite this strong lean towards the domestic market, some SMEs also felt that an overseas would help them move towards an increase in output.
13% of the SMEs questioned felt that European Union held the most growth potential, while this figure stood at 12% for growth potential offered by exporting to the Middle East and Asia.
Commenting on the survey findings, Mike Randall, CEO of Close Brothers, said: “It’s interesting to learn that despite the government’s work to encourage UK businesses to export in an effort to rebalance the economy, so many seem hesitant to look further afield to achieve their potential.”
With the government’s target of £1 trillion exports by 2020 to reach it seems that SMEs will need to address their export potential, even if they are performing well in the domestic market.