By Andrew Jesse, VP, Basware
Recent statistics have outlined that the financial technology sector is one of the strongest sectors in the UK economy, with investment jumping 177 per cent in the first quarter of 2014 compared to last year. It is clear that this is a large growth area for the economy, and why wouldn’t it be?
Regardless of the size or type of business, finance is at the core of every moneymaking organisation. Companies, large and small, trade with each other and adhere to a transactional process, regardless of the sophistication of the systems they may have in place.
Fuelling the growth of technology use is the need to make these transactions, and finance processes more efficient and more accessible for organisations of all sizes and within any sector. But how do these innovations which are growing the economy, translate to growing your business, especially when looking at exporting globally?
When exporting, there are many extra considerations businesses need to make in terms of political and social factors, cultural differences, trading patterns, legislations, customs clearances, administrative hurdles and regulatory rigours. For example, In China, import tariff rates are broken down into six categories and tariff rates may be applied at a significantly lower cost than what has been outlined if the goods are considered necessary to the development of a key industry by the government.
There are a lot of considerations that a business must make and the government investment announced in March this year is a fantastic step but will not produce an export nation alone.
Businesses need to take action in ensuring that their financial processes and systems are of a competitive nature and able to deal with the increased complexity that comes with dealing with other currencies. Alongside these multiple currencies are numerous payment methods, regulatory differences, taxation systems and a multitude of languages. If a businesses financial systems are not robust and transparent, control will slip and it will be increasingly difficult to deal with customers/suppliers based in other parts of the world.
Many businesses struggle with cash flow and visibility when dealing purely in the UK, so adding other markets into the mix will only make this more complex and indiscernible. However, through financial innovations such as automation tools and analytics, transparency can be increased, improving cash flow, minimising the risk of fraudulent activity and incorrect data. This enables UK businesses to have the support necessary in order to make their global expansion and exporting goals a reality and gain competitive advantage.
Before exploring your exporting opportunities, ensure your financial systems are equipped to handle the venture and your product travel dreams will become a reality!