By Jonathan Quin, CEO and co-founder at World First
Before the end of March, Theresa May will trigger Article 50 and set in chain a motion of events that will see the United Kingdom leave the European Union within two years.
The historic referendum result leaves our trading relationships with European nations in an uncertain position and UK businesses must be encouraged to adopt a more global mind-set and think beyond Europe. Financial directors will be tested over the coming months as they seek to navigate their business through economic uncertainty. Nevertheless, opportunities exist for businesses bold enough to look further afield for growth.
Whilst recent political events may suggest that individuals are turning away from globalisation, business owners will know that, increasingly, the future is international. Over the next few years, it will be those businesses that have looked for opportunities to expand, to develop new trade routes and access a new customer base that are most likely to succeed.
At World First we recently published a report with the CEBR to highlight the importance of Thinking Global for future SME exporting success. The report outlined 39 countries in Africa, Asia and the Middle East with a projected annual growth of at least 5% between 2010 and 2031. Nevertheless as a nation, Britain lags behind its European counterparts when it comes to exporting and our economy has felt the impact of a significant trade deficit.
So what’s behind such a reluctance from businesses to expand into new markets?
Although there is ample opportunity for expansion into new and emerging markets, barriers must be overcome to facilitate new trading relationships. Some barriers are established and long-standing issues that businesses often encounter when exporting to new markets such as language barriers or cultural differences in how business is conducted. Others are more market-specific such as in Asia where payments can be difficult to manage with the need to set-up new bank accounts and comply with local identification requirements just two obstacles to fast and efficient transactions.
Other challenges are much more technology driven and centre around how businesses can take advantage of multi-channel opportunities and digital marketplaces. These changes have provided consumers with the ability to purchase and receive products from anywhere in the world and digital businesses such as Amazon and Alibaba have ridden this wave of innovation to become some of the largest companies on the planet.
In parallel to this, technological innovation has pervaded our financial services system with international payments able to be conducted seamlessly across multiple borders. Businesses can now manage their supply chain more quickly, easily and from remote locations. They can now pay suppliers through mobile and web applications, rather than the long-drawn out processes of yesteryear.
Crucially, as the tectonic plates of the world’s political and economic landscape continue to shift, finance directors across the UK must embrace technological innovation to drive growth and continue to thrive in an increasingly competitive and global marketplace.