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Supporting SMEs: the personal touch is the key to finding the best export partners CREDIT: GETTY

Sean Hargrave

26 MARCH 2019 • 12:00PM

There is a lot of support available to SMEs considering exporting but owners agree nothing beats getting on a flight and finding the best local partners yourself.

Despite the uncertainty of the UK’s future trading relationship with the EU, the proportion of SMEs who export rose to its highest ever level last year, to nearly 10 per cent, the latest ONS figures show.

It is an important rise because the Government is pinning its hopes on SMEs helping it hit a target to raise the proportion of GDP earned through exporting from 30pc to 35pc.

The central strategy will rely on the Department of International Trade (DIT) guiding SMEs through the maze of decisions they must make; such as which countries to target, whether to go direct or through a distributor and what tax, tariffs, insurance, certification and paperwork apply.

Trade mission success

SMEs can actually benefit from a wide range of support when looking to attract customers from overseas, and they are advised to talk to their local British Chambers of Commerce group to get feedback from fellow business people, and the Institute of Export, which is a useful resource for tips from experts in overseas trade.

Reaching out for Government advice and contact introductions has certainly worked well in helping Mark Bembridge, CEO of AI advertising technology firm, Smartology, open a New York office earlier this year. His main advice to any other SME considering export is to find official programmes, in his case the London Mayor’s International Business Programme (IBP) and the Department for International Trade (DIT).

Mr Bembridge joined a DIT trade mission to New York last year, which proved invaluable in providing access to high-level business contacts and international trade experts.

“Government networking events have put us in front of exactly the people we need to grow our user base internationally,” he says.

“In last year’s New York trip the DIT lined us up with some top contacts and they also arranged for us to speak to business experts about how to go about setting up an American company. If you find these guys yourself, you’re never too sure if you’re getting the best advice, but we know we could trust the people we were put on to by the DIT.”

Local partner advice

Alan Barratt, co-founder of the sports nutrition brand, Grenade, agrees that going it alone is not a viable option. He has found that the earliest demand from an export market is normally organic, through a small number of overseas sales that gets a business wondering if they could sell more. His advice is not to instantly go all-out for sales across an entire new country, but rather pick a city before the wider market is opened up.

To do this, though, Barratt’s advice is for SMEs to research both the market and potential new competitors thoroughly, and then always seek the advice of experts on the ground.

“You may know your product inside out but it’s unlikely you’ll know the foreign markets anywhere near as well, nor should you be expected to,” he says.

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Local knowledge: research the rules and regs to ensure products are compliant in the market you’re dealing with CREDIT: GETTY

“You need to seek help from local advisors. You need to consider the bureaucratic obstacles and legal considerations involved. That equates to a lot of laborious paperwork. Most entrepreneurs won’t feasibly have the time to examine the ins and outs of it. Not only do you need the necessary certificates and licences for shipping, but you must also make sure the produce is compliant to the markets you’re supplying it to.”

Choosing the right strategy

SMEs who are also exporters point to the need to use all the resources available to research the market, its rules and how it operates to understand how best to approach opening it up for their products or services.

For Nick Wade, Export Sales Director at skincare company, Skin Academy, once the initial research is carried out and a country looks promising, the only way to get a better idea is to immerse oneself in the market through business trips, particularly conferences, so long as the right contacts are going to be there.

He warns, though, that the biggest mistake a company can make is taking a homogenous view of all export markets. Each country operates in its own unique way and will require different strategies to be opened up for business.

“What works in one country will not necessarily work in another,” he advises.

“We adopt a number of different strategies, be that direct to retail, via a distributor, or through an agent or broker. Ultimately, each route will have its advantages and disadvantages. A lot of our international exposure and development actually comes through international exhibitions, but it is of paramount importance to choose the right ones. They can be costly mistakes if the eventual clientele is not what you are looking for.”

The route to market will change for each product or service according to local conditions, and so SMEs who have taken the plunge agree that taking official help as they research international trade is a must. So, too, is jumping on flights to establish which partners need to be brought on board to help with the intricacies of understanding the best route to market and staying on the right side of local regulations.

2019 The SME Agenda

The 2019 SME Agenda looks at the core challenges facing SMEs in the year ahead. From Brexit to housing, how is the state of the nation affecting the businesses within it? To access a copy and find out, download the report.

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Taking care of business

Business banking in the UK needs more competition, but business owners themselves need to think more broadly about which bank is best for their SME. Today’s business landscape demands equal attention be paid to cutting-edge technology as it is to human relationships. That’s why the Telegraph and Yorkshire Bank are examining how SMEs can look to the future without letting go of the proven principles of good business.

Yorkshire Bank takes a relationship-based approach to small business banking, and embedded in the heart of its approach is the importance of direct contact with business owners to support their needs. To find out more about why you may want to switch your business banking provider, or how you could better balance technology with a personal touch, visit secure.ybonline.co.uk/business

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