By Guy Rigby, Head of Entrepreneurs, Smith & Williamson
Growth in the UK and other Western economies is forecast to remain subdued, whereas many Asian, South American and other emerging economies are still powering ahead. Perhaps it’s time to look further afield for your sales?
Thanks to advances in technology, communications and logistics, even the smallest businesses can now access international markets, buying and selling their products and services worldwide.
And, with the support of the Government’s Export Enterprise Finance Guarantee (ExEFG) scheme, now is probably as good a time as any to start looking beyond the UK.
The ExEFG is aimed at small and medium sized businesses in all sectors with an annual turnover of up to £25m. Export finance facilities of between £25,001 and £1m are available, with the terms of any loan being up to two years for those businesses that qualify.
For some businesses, setting up overseas operations, rather than just exporting, can be a sensible course. Apart from the more obvious benefits of cost savings and new markets, establishing overseas operations can enable you to attract new talent, facilitate product development and leverage different time zones to enhance operational efficiencies.
Setting up or expanding overseas can involve significant challenges and risks, so below are some key tips on how to take your business global.
- Identify your objectives and the specific tasks and resources required to achieve them. Decide who will manage your offshore operations. Define timescales and key deliverables.
- Assess potential offshore models and analyse operational, financial and legal requirements.
- Consider personnel recruitment, training and retention. Build one team and factor in the cost of bringing your core overseas team to your head office to absorb the culture, get to know your local team and feel included.
- Establish IT and infrastructure requirements and set key performance indicators to measure performance and operational success.
- Choose the right location. Base your decision on the availability of the specific skills you need, the cost of labour, the travelling costs and accessibility, time zone and cultural compatibility.
- Assess the financial impact. It’s not only the benefit of reducing costs that should be considered, but the revenue-generating benefits as well.
- Think long-term. While upfront expenditure on familiarisation, infrastructure implementation and associated set-up costs may be relatively high, this investment may ultimately determine the success of your overseas activity and the return on your investment over time.
- Trading overseas can increase your financial and operational risks. Monitor your financial position rigorously and keep your risks constantly under review.
If you would like to find out more about the ExEFG or want to discuss taking your business global, contact Guy Rigby on 020 7131 8213 or email firstname.lastname@example.org
Watch the video below featuring Guy Rigby of Smith & Williamson discussing the reasons why a business needs vision, a strategy and tactics to succeed.
Join us on