After it was recently revealed by the OECD that the UK will potentially fall to the bottom of the growth league in 2025, leading global logistics specialists Aramex UK has urged the new Labour government to prioritise giving further support to SMEs that seek to expand their presence internationally.
The vast majority of businesses within the UK are SMEs, employing 16.7 million people and contributing £2.4 trillion per year to the economy.
In many respects, such businesses are the UK’s lifeblood, and while the previous government aimed to drive export expansion and seize global economic opportunities, increased bureaucratic and logistical challenges have led to a significant contraction in the UK’s goods exports since 2019, surpassing declines seen in any other G7 country.
However, despite economic uncertainty and geopolitical issues upending supply chains, the prospect to diversify revenue streams in new and emerging markets is still firmly on the agenda for UK businesses, with HSBC estimating last year that around 450,000 brands have ambitions to seize international opportunities.
According to Umar Butt, Regional CEO – UK and Europe at Aramex, SMEs should be seen as the one of key engines of growth and sustainability for the UK economy, believing it essential that they are equipped with the resources and regulatory support to help realise their growth and seize lucrative opportunities that exist outside the domestic bubble many find themselves in.
Umar Butt commented:
“We currently live in an era where for the most part businesses are no longer limited by geographical proximity, and as such have the luxury of being able to tap into new and unique markets far beyond their domestic borders. The rise in digitalisation and online marketplaces have played a significant role in this, helping to revolutionise modern-day commerce and offering UK brands unprecedented opportunities for international expansion that were previously inaccessible.
“Exports are a key driver of economic growth, yet only around 10 per cent of UK businesses sell their goods to non-UK customers, therefore it’s no secret that if the economy is to get back on track, the Labour government should be investing time and resource into enhancing support for SMEs seeking to diversify into international markets, while also quashing the frustrating roadblocks they face on a day-to-day basis.
“Since the pandemic, most advanced countries have witnessed a bounce-back in goods trade, however the UK hasn’t, which is unusual. Reducing the amount of unnecessary red tape and providing bespoke guidance for businesses would go a long way to fostering growth and reversing the decline in UK goods exports over the coming years.”
To provide their own support to SMEs, Aramex UK has recently introduced its SME program, which pledges to avoid implementing any volume caveats, credit restrictions or price limits for low volumes, enabling businesses to compete in an increasingly competitive global marketplace by removing any unnecessary barriers – all with the aim of providing businesses with a springboard to realise their full potential on the international stage.
Umar continued:
“In recent years we as a business have looked to make global expansion more accessible for SMEs by providing tailored support services and simplifying the end-to-end logistics process, however these initiatives will only go so far. Responsibility now lies with the government to pull up the shutters by publishing a trade strategy that is realistic and delivers clear advice to get more businesses exporting.
“From our own analysis we have actually witnessed a swelling ambition among SMEs to trade internationally, which should encourage the existing government to accelerate plans to facilitate this. However, more needs to be done in Westminster this time around to provoke further confidence that expanding internationally is feasible for SMEs, provided the right support and regulatory infrastructure are in place.
“As a part of this, the government must avoid a one-size-fits all approach to its messaging and educational materials. Without the correct advice to hand, the prospect of exporting to new markets becomes an incredibly daunting task, especially to those making their first steps on this journey.”
