Time Is Right For SMEs To Look To Exporting For Growth
Favourable exchange rates, improved access to credit and diverse supports means there has never been a better time for Irish SMEs to enter the export marketplace, writes Bernard McCarthy (pictured), Managing Director of DHL Express in Ireland
A survey of 480 SMEs and experts from business lobbying groups across 12 countries and 20 industries around the world, conducted by the Economist Intelligence Unit (EIU) on behalf of DHL Express during Q4 2014, showed that the majority of SMEs see growth opportunities abroad and expect to derive up to 50% of their revenues internationally within five years.
Irish SMEs are also optimistic about exporting and more are doing so than ever before. A study undertaken last year by IPSOS MRBI for AIB showed that exports account for 39% of SMEs’ turnover, and the majority of these companies anticipate growth into 2015 and beyond.
So for SMEs looking to take their first step into the export market, or an existing exporter seeking to expand into new markets, there are many reasons to support the case that there has never been a better time to commence or expand export activities.
In Association with
UK Opportunities
The UK has always been a key export market and today accounts for almost 50% of Ireland’s merchandise export volume. With the euro trading at historically low levels against sterling, Irish exports are more keenly priced than their UK competitors. The UK is also a relatively easy place to start exporting, given the shared language, similar business culture and consumer preferences and tastes. So now is the perfect time to enter the UK market.
European Markets
For exporters trading exclusively with the UK, the EU is a logical next step in terms of expansion. Eighteen of the 28 countries in the EU operate within the eurozone, so there’s no exchange rate risk to these countries. Remember also that the EU operates as a single market, so for the vast majority of goods and services there are no customs or regulatory restrictions.
Funding Improvements
Access to funding has been consistently raised as a barrier to business expansion in recent times. But there’s evidence to suggest that this is changing. In their 2014 results, AIB and Bank of Ireland reported significant increases in business lending. The creation of the Strategic Banking Corporation of Ireland (SBCI) is also a very positive and welcome development. SBCI’s goal is facilitating the provision of lower cost funding to financial institutions, which is passed on to SMEs. This could make a significant contribution to the exporting sector in particular.
DHL Express Supports
We’re taking an active role in encouraging companies to take their first steps as exporters. As well as providing the network infrastructure to physically move Irish exports to more than 220 countries worldwide, we have developed a range of supports for new or potential exporters.
Our website (www.dhlguide.ie) provides a guide to taking your business international, with tips and practical advice on everything from export planning and research, to customs, Incoterms, shipping documentation, insurance etc.
Last March, DHL Express, in association with The Irish Exporters Association, ABP, AIB, Euler Hermes, PWC, and collaborating with the Department of Foreign Affairs & Trade, Enterprise Ireland and Bord Bia, launched a new initiative for exporters. The National Export Campaign and National Export Hub were launched to encourage more exporting and to build SME export competence nationally.
The intention is to increase awareness amongst SMEs of the benefits and challenges of exporting. The National Export Hub complements the existing private sector and state support agencies, who already do a tremendous job in supporting companies on their export journeys.
See here for DHL Tips on negotiating Customs.
