A New Report Has Shown SMEs Need To Export If They Want To Grow After Four Years

A new report from Barclays has shown businesses hit a growth ceiling after four years and struggle to increase profits after this point.

However, the banking group's publication did have some good news and indicated exporting could be a way to mitigate this problem and avoid sluggish demand in the domestic UK market.

Just over half (52 per cent) of SMEs surveyed by Barclays commented that it was psychological barriers that made them not think of exporting sooner than they had and 47 per cent of those who utilise foreign markets wish they had done so earlier.

But once the psychological obstacles are surmounted it is clear most SMEs benefit from a more global mindset and 86 per cent of bosses questioned found the experience as they hoped or easier than expected.

Simon Nicholson, head of international functions at Barclays Business Banking, said: "What strikes me about our research is how successful at exporting SMEs are. This is despite 60 per cent claiming to have 'fallen into it', or only looking at it 'when an overseas customer got in touch'.

"With such high growth opportunities, imagine the possibilities that could come from taking a more proactive approach! We are committed to helping UK SMEs trade confidently across the globe."

To match its pledge, Barclays has announced a 40 per cent discount on international credit checks for SMEs based in the UK, as well as a 25 per cent price cut on incoming and outgoing international payment charges.

However, while exporting becomes more and more central to the coalition government's economic strategy, there have been some concerns the UK's education system is not preparing the next generation for a globalised world.

The number of pupils at schools being taught a second language has dropped in recent years and attempts to get more educational institutions to teach non-European languages to students have been met with inaction from most state schools across the country.

Expert Opinion

The Government says that it wants the UK economy to become more focussed on exports and it’s clear again from this study that more needs to be done to encourage small and medium-sized businesses. <br/> <br/>“This survey has coincidentally been published at the same time as a CBI report into global expansion in which the issue of access to the UK Export Finance initiative is also highlighted. <br/> <br/>“Psychological and financial barriers are just two of the many obstacles that exist to growing a business overseas and it is vital that businesses seek out the appropriate advice to ensure that opportunities are not wasted.” <br/> Steven Beahan - Partner