Carving out a new avenue of income is essential for any business to expand.
As the overseas demand for quality Scottish products and services continues to grow, Export Week – which runs until Friday – is a timely reminder to Scottish small to medium-sized enterprises (SMEs) to seize global opportunities and tap into emerging markets
An important driver for economic growth, exporting has been linked with increased innovation and productivity. For those already trading internationally, the activity generates almost a third (32 per cent) of their total sales turnover.
The Scottish Government also has ambitions targets for exporting to drive growth and create new jobs across Scotland with a goal to increase the value of Scottish exports by 50 per cent by 2017.
However, the Bank of Scotland Business in Britain research shows that Scottish businesses are being too conservative in their export ambitions and are not considering key growth markets overseas. Just over three out of five SMEs (62 per cent) don’t currently export despite businesses apparently being well aware of the potential benefits.
To mark Export Week, Bank of Scotland has released a snapshot of export activity among SMEs in Scotland from our Business in Britain survey.
Firstly, at the close of the first half of 2015, well over half (58 per cent) of Scotland’s businesses forecast an increase in their export activity during the second half of the year. This may in part be driven by concern over weakening domestic demand for products and services with over a third (35 per cent) of Scotland’s businesses seeing this as an issue.
Despite recent turbulence, the eurozone continues to be a key target market for Scottish firms, with 52 per cent of businesses increasing exports to the territory. Sales to North America and Asia are also set to increase by 33 and 36 per cent respectively.
There is extensive support available for Scottish businesses looking to capitalise on the opportunities that exporting brings. From a financial assistance perspective, specialist finance products can be widely useful. For example, trade finance is a working capital facility specifically designed for exporting companies, and ensures longer payment terms don’t impact a business’ day-to-day operations.
Earlier this year Bank of Scotland, as part of Lloyds Banking Group, announced a strategic partnership with UK Trade & Investment (UKTI), which was founded to help UK businesses seize growth opportunities internationally, to help increase exports and attract inward investment.
As part of our SME Charter, we have pledged to boost international trading by growing our provision of trade finance to SMEs by 25 per cent.
• Graham Blair is area director for SME banking, Scotland, at Bank of Scotland