Half of SMEs ‘want to start exporting’

A business insights survey indicates that UK SMEs are thinking big and looking to grow in overseas markets as a priority, despite the ongoing uncertainty around Brexit.

Business person surveying horizon with binoculars
Over half (56%) of 1,000 business owners with companies listed at Companies House surveyed said they hoped to open offices abroad and start exporting to global markets. Smaller SMEs are more driven by this ambition than their larger counterparts. Anil Stocker, co-founder and CEO of MarketInvoice, an online platform offering flexible invoice finance, which commissioned the survey, said: “UK SMEs are thinking big, which is great for our economy, employment and global positioning.“There are some huge macro and political changes taking place with Brexit and the US-China trade challenges, but it’s great to see entrepreneurs seeing the growth opportunities around these events.”

Boosting value in the UK’s SMEs

The survey also finds the typical UK SME is worth more than £2.9m. Company valuation is something two-thirds (66%) of those surveyed consider to be a huge priority and an issue always on the agenda.While company valuations are clearly a high priority, less than a third (30%) of businesses increased in value by more than 10% in the last 12 months, supporting the trend towards looking to overseas markets to boost growth.Business owners also felt becoming more tech-savvy and data-centric to support their scaling ambitions would be the biggest driver for increasing valuation.Interestingly, larger SMEs felt expanding their customer base would drive the most value. Younger entrepreneurs vest hopes in their products to drive valuation, while the older generation felt technology adoption would move the dial.

What are the obstacles to SMEs realising their global ambitions?

Owners ranked a lack of appropriate finance options as the largest hurdle in raising value and growing their businesses. Companies in the engineering, architecture and construction sectors felt this the most. In contrast, companies in the finance sector ranked skills shortages as their greatest hinderance, the survey found. In addition to company financials, business owners cited their premises (17%), product (15%) and people (15%) as key factors that contribute to company value.“Business owners seem to be driven by company valuation," said Anil Stocker. "It is imperative that they stay focused on their product or service offering and ensure the fundamentals are right first.“This is as much about managing cash flow and working capital as it is about having the right people in the right roles. A well-oiled business will look after itself. Essentially, getting the basics right will drive their businesses forward and the valuation will take care of itself.”

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