SMEs in London missing vital export opportunities

New research has uncovered that only 20% of London’s small businesses have plans to trade internationally this year. With most companies ruling international commerce out, a great percentage of London businesses are missing out on vital opportunities that could help them recover from the impacts of the COVID-19 pandemic. According to the Alibaba Group, reluctance to partake in international trade is mostly due to the lack of knowledge regarding costs and complexity of importing and exporting, as well as cultural barriers. Thus, communicating information is key to combating this avoidance of international commerce.

Businesses Voice Concerns that they are too Small to Trade Overseas

Many small businesses in London mistakenly believe that they are too small to succeed in trading internationally. In fact, almost a quarter of small businesses have stated that their sizes prevent them from pursuing international clients. Moreover, 18% of these companies believe there isn’t enough global demand for their products and services, while 13% of London’s small business owners believe that the process of setting up international trade and looking for opportunities in overseas markets is too confusing. Only a fraction of small businesses based in London also claimed that they were planning on trading outside of Europe, with 7% planning to trade in the Middle East and none in China.

Thus, lack of information, as well as misconceptions surrounding the costs involved in exporting, have resulted in many businesses missing out on vital opportunities to stimulate growth. Bridging this information gap could, therefore, facilitate trade between small businesses in the UK and international markets.

China Presents a Great Opportunity for Trade

China, in particular, offers a significant opportunity for British businesses wishing to trade internationally. According to Al Jazeera, China’s retail market has already recovered from the economic downturn caused by the pandemic. Unfortunately, many of London’s small businesses believe that there is a lack of demand for their products in China, with 25% of them stating that this is their reason for not attempting to trade with the country. Misinformation, once again, is costing British businesses significantly, preventing them from taking advantage of lucrative markets. However, small businesses in London who enter Chinese luxury goods, health, beauty, and nutrition markets have the opportunity to generate large amounts of revenue since they have remained high in demand since the beginning of the pandemic. 

Stay Tuned with Export Portal

At Export Portal, we are dedicated to communicating the latest and most relevant industry updates to equip business owners with the knowledge essential to thrive in international trade. Come check out our blog today!