Beat the Brexit blues through international expansion

For businesses unnerved by the ongoing uncertainties of Brexit, taking cover by reducing investment or shelving expansion plans is a natural instinct. Santander’s own research suggests many businesses are doing exactly that: our latest Trade Barometer survey, conducted during spring 2019, reveals that in some areas of the economy, up to a quarter of businesses now plan to invest nothing at all over the next 12 months. However, while such caution is understandable, there are a range of opportunities that businesses can explore to improve growth despite the political or economic volatility. In particular, international trade can provide a potential lifeline.

Increasing your overseas sales – or exporting for the first time – can offer both a means to continue growing your business as well as mitigate a challenging environment at home. Santander’s Spring 2019 Trade Barometer underlines this message. While 23% of domestic-only businesses expect to cut their total investment budget to zero over the next 12 months, the figure falls to 13% for businesses that already have an international presence. Among businesses currently selling only in the UK, but with plans for overseas expansion, just 6% are planning no investment.

The growth markets

For those businesses prepared to be bold, the opportunities are global. Almost a third of the Trade Barometer businesses (31%) see potential to grow their sales to the US over the next 12 months. Nearly a fifth (17%) say the same of China. Canada (13%) and Japan (10%) will also be important growth markets for UK companies in the year ahead.

This is not to suggest exports to Europe are set to go into reverse. It may be difficult to see past the Brexit storm right now, but significant numbers of businesses are looking forward to growth opportunities in Germany, France, Italy, Spain and Ireland over the next 12 months. Still, businesses in the UK increasingly recognise there is no need to limit their horizons. Santander’s recent analysis of ONS data on the top 50 goods export markets of the past 20 years revealed that the 10 fastest growing markets last year were predominantly non-European Union countries.

Choosing the right strategy

Importantly, however, every business is different: the right export strategy for your company – the markets on which you focus and how you target them – should reflect the strengths of your organisation, rather than what other firms are doing.

Take time to do your research to find out more about the markets. Resources from platforms such as the Santander Trade Portal and Trade Club will provide ease of access to information as well as connect you with contacts, buyers and likeminded businesses. We can also offer guidance from sector and country specialists on the markets you are looking to enter. And don’t be afraid to ask for help from other organisations in the UK with access to valuable resources that can help you trade abroad, such as the Department for International Trade.

Having the right support can be a huge boost as you tackle unfamiliar territories, and can help with a host of bureaucratic issues ranging from tariffs to intellectual property protection. But identifying the most suitable route to market is also crucial. Ecommerce, for example, is playing an increasingly important role in helping first-time as well as existing exporters reach new customers without having to commit to a physical presence in their target market.

There’s no shortage of options for businesses prepared to be brave. The bottom line is that export success is there for the taking, as long as you don’t let Brexit blow you off course.