Business exporting has not improved in two years according to research from ICAEW
BUSINESS EXPORTING has not improved in two years according to research from ICAEW.
Only 53% of businesses are exporting a figure that has remained the same since 2014, even though the government had an export target of £1tn and an advertising campaign.
Fewer exporters are expected to enter new markets in the next 12 months compared to the figures received in previous years, 25% in 2016 and 33% in 2015. In addition, 96% of non-exporters have no plans to sell overseas this year.
The most cited reason for 41% of these results is that both SMEs and large companies believe they have a ‘sufficient’ market in the UK.
Stephen Ibbotson, director of business, ICAEW said: “This research illustrates that government is failing to encourage businesses to export goods internationally, despite a multimillion pound government campaign over five years. In a post-Brexit world where business confidence is low and investment sluggish, it’s important that exporting is incentivised.”
The top export destinations for 30% of exporters are Europe and the USA, where more than half of turnover comes from overseas trading which UK jobs depend on. With weak domestic demand, the rise in input prices and the decline in sterling, export growth is expected to ‘overtake’ domestic sales in 2017.
Only 1% of businesses plan to start exporting in the next 12 months with an additional 1% are considering it while only 5% of SMEs have started exporting in the last two years, which is a concern for the government.
Less than a fifth of exporters looking to expand overseas would use government departments that promote international trade, such as the Department for International Trade for advice.
Ibbotson concluded: “The Government should look at funnelling some of the money from the Department for International Trade into directly incentivising business into export. For example, introducing a voucher scheme for companies researching and developing in overseas markets.”