The opportunities for international growth
UK SMEs need more support to export - and an ACCA report suggests that helping them is a route to growth for others too
Going global leads to growth at home. And as the government enters the final months of Brexit preparations, it’s more important than ever that small businesses in the UK tap into available support and finance to take their business international. The companies that support them can also do more to help – and, by doing so, can help secure their own success.
This was the finding of a new report from ACCA (the Association of Chartered Certified Accountants), Growing Globally, that surveyed financial professionals at both SMEs and small and medium-sized accounting practices (SMPs).
The report revealed that 91 per cent of SMPs surveyed have clients engaged in international activity. And those SMEs that are doing business overseas are seeing benefits of increased profitability, faster business growth, access to new business networks, and the opportunity to develop more products and services.
But only 69 per cent of UK SME respondents said they intended to increase their international trade activities in the coming years – a low percentage compared to other countries included in the report, such as Ireland (84 per cent), Malaysia (77 per cent) and Singapore (76 per cent).
Access to support
Identifying with issues ranging from understanding of foreign regulation, tariffs and currency exchange, almost half of the UK SMEs surveyed said they would benefit from more information and support on international trade.
Some of this will be down to government to provide – and promisingly, 41 per cent of respondents said that the government securing improved or new trade agreements would in turn encourage them to participate in international trade.
There are some ways in which SMEs can better help themselves, including embracing cloud technologies, developing the scalability of their finance function, and creating a business strategy with global ambitions.
But they also need to identify where external advice could support their internationalisation.
Accountants are already used by SMEs looking for support on international tax, regulatory compliance, foreign exchange and accessing external finance.
And as SMEs continue to seek new ways of engaging in international trade, partly brought about by developments in technology, accounting practices are being presented with opportunities to develop and widen their international advisory provision.
The report highlights the following ways in which they can develop this more effectively:
- Specialisation is key - For those developing their international advisory provision, it is vital to first identify an area of the market where you believe your practice has the opportunity to effectively develop its expertise, resources and intelligence to best suit the needs of your clients.
- Adopt a strategic mindset - Identifying where you could best add value in terms of international support requires SMPs to think strategically and embark on initial planning and research. The best place to start is with existing clients rather than prospective ones.
- Expand your international network - Networks are integral for the development of new professional advisory services but particularly with regards to internationalisation.
- Invest in professional development - Practices must have highly skilled staff with the appropriate intellectual knowledge for clients to recognise the value in the services you offer.
All this comes at a time when SMP business models face a series of challenges to their core revenue streams as forces like technology, internationalisation and deregulation disrupt traditional client services. Diversifying can be challenging, but it’s clear that accountants can be one of the most useful resources for support small businesses as they grow globally. It’s an opportunity that shouldn’t be missed.