Access to finance is still a barrier to exporting for UK firms, a report by the British Chambers of Commerce (BCC) has found. In its annual International Trade Survey, the BCC found that 60% of potential exporters cite general access to finance as a key factor in their plans to export goods or services.
Additionally, one quarter (24%) of UK businesses preparing to export have reported difficulty in accessing trade finance or credit insurance from lenders – products tailored specifically to support firms trading in overseas markets.
Access to finance is an issue for firms of all sizes. Of the 60% of UK firms on the cusp of exporting who stated that securing the right funding was a key consideration in deciding if, when and where they would export to, over half (57%) are micro firms, 29% are small firms and 14% are medium or large firms.
Despite this, 90% of businesses that are already exporting say further expansion is a priority, indicating that confidence in economic growth is becoming more widespread across the country and that appetite for new expansion is returning.
Accessing the appropriate financial products is crucial to businesses planning to enter export markets, to help cover new costs including market research and product development, and managing the risks around shipping and payment.
John Longworth, Director General of the British Chambers of Commerce, said:
“A fundamental revolution in our approach to exporting is needed if we are going to reverse our historic trade deficit, overturn our current account deficit and maintain Britain’s position as a leading global trader. We already have world-class products and services that are in demand globally – we now need to ensure the door is open for all UK businesses wanting to trade overseas.
“While support for UK companies to finance exports of goods and services should be further enhanced, we also need to understand why a quarter of the exporting firms surveyed have been unable to access the financial products specifically designed to help them trade overseas.
“There are huge potential rewards for firms that can access overseas markets, but there are also costs associated in exporting. The government needs to ensure that UK Export Finance and the British Business Bank offer world-class support to UK businesses, and remove one of the main barriers to exporting – access to finance.
“To ensure that UK exporters have direct access to on-the-ground support in new markets, the BCC and chamber network are playing our part by actively expanding our Global Business Network to link British firms with customers and opportunities in the fastest-growing economies overseas.”