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29 April 2014

Export for Growth...

Clive Drinkwater, Regional Director of UKTI North West is urging companies to expand their horizons in 2014 and look to overseas markets as a way to boost trade...

Clive_DrinkwaterUK Trade & Investment (UKTI) works with UK-based businesses to ensure their success in international markets, and encourage the best overseas companies to look to the UK as their global partner of choice.

With professional advisers both within the UK and across more than 100 international markets, UKTI has supported a broad range of businesses in the North West, some of which have also received finance from The North West Fund.

As business optimism in the region grows, Clive Drinkwater, Regional Director of UKTI North West is urging companies to expand their horizons in 2014 and look to overseas markets as a way to boost trade...

There is growing evidence that export-led economic recovery is no empty mantra but a realistic aspiration. Increasing export orders and growth in SME confidence indicate that
the messages of the benefits of exporting are hitting home.

Businesses that export are, on average, 34% more productive, 12% more resilient (more likely to survive through difficult times), they are 75% more innovative and deploy three
times as much R&D as non-exporting firms. Growth through exporting is a well-worn
path to success but we need to inspire more businesses to take the first steps.

I believe we need a step change in how we go about growing exports in a sustainable way with a strategy for emerging high growth markets as well as traditional developed ones.

There is a plan that businesses can follow...

1. Begin planning now and take advice

There is a growing body of evidence to show that firms that take advice perform better so seek advice early but plan carefully.

2. Seek out growth sectors

Some sectors have noticed little or no downturn and there is the promise of real growth in:

  •  Medical/Bio/Pharma
  •  Energy/Environmental technologies
  •  ICT
  •  Digital/Creative

3. BRICs and beyond

Look at emerging markets, where middle classes are expanding rapidly and spending on goods and services hitherto associated with developed world consumers. Naturally, these
economies include Brazil, Russia, India and China (BRICs), but even in China and India, the biggest opportunities may lie outside the traditional trading centres, in the fast-growing provincial and so-called second-tier cities.

Consider the next four biggest and fastest growing markets: Mexico, Indonesia, South Korea and Turkey, or my own acronym MIST.

If you ad BRIC and MIST together those eight countries amount for half of the world's population, 33% of its GDP but attract only 17% of the UK's exports.

Other markets are on the march too. Don't forget about countries such as Chile, South Africa, Saudi Arabia, Malaysia and Nigeria. Follow the growth and don't allow your
exports to stagnate.

4.  Don't ignore the huge European market on your doorstep

That said, do take full advantage of the quota and tariff free access you have to markets in the European Union. It should form the backbone of your early stage exporting plan given the relative benefits you have of market access.

5. Follow FTAs

Free Trade Agreements (FTAs) represent huge opportunities for growth. The EU announced
FTAs with Peru, Panama, Nigeria and Honduras last year and it's not long since we signed an agreement with South Korea. There are agreements pending in Canada and Ukraine and we are negotiating with USA, India, ASEAN and Japan.

6. 2014 is the year the world comes to Liverpool

The International Festival for Business will be the biggest festival for business since the
Festival of Britain and its happening here in Liverpool. There is a huge array of events across numerous sectors and markets. Get involved and connect with the international business opportunities that are being brought to you.

7. Look at yourself

Every market presents unique challenges, and effective exporting requires a sound base of
research, complemented by appropriate internal resource and skills. It also requires adaptability. Different business practices, culture, market entry requirements, even something as simple a different mains voltage, all need to be considered, so differentiate your product or service offer accordingly.

Getting your growth strategy right is critical. Exporting will not come without investment
and you need to consider how best to fund your activity. The North West Fund is here to help advise on how best to structure your growth so take advantage of the tremendous expertise available.

8. It's a gift until you've paid

UK Export Finance has received a boost in the recent budget for its services to SMEs and its
advisers are real experts. Speak to your bank/financial institution about the services they offer but make sure you don't fail because of bad debt.

And remember - exporting needn't be scary - Although we are in a great position to enhance our export-led recovery it will not happen by chance. Bodies like UKTI offer a
range of services to help businesses succeed, helping them prepare, find the right markets and make the right contacts.


For more information about UK Trade and Investment visit www.ukti.gov.uk

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