UK medium-sized businesses must embrace global business concepts in order to improve the UK’s future economic prosperity, a report released today reveals.
The report by CBI and accountancy firm BDO targets mid-size businesses (MSBs), highlighting the “intrinsic mentality” of these organisations and the importance for them to act more globally and consider the power of exports.
CBI chief policy director Katja Hall said in the report, that “improving the UK’s trade performance was central to (the UK’s) future prosperity – and MSBs have a critically important part to play in that process.”
The report identifies a five-stage journey that an ambitious domestic firm would need to make when moving from a non-exporter all the way through to ultimately, a global business.
It states that in order to capitalise on overseas opportunities, successful MSB exporters should begin to think and act like an international business. This could mean expanding their footprint in existing markets and growing into new, high-potential countries.
Despite only representing 1% of firms, MSBs employ 16% of the UK workforce and generate 22% of the UK’s revenue. In a 2011 CBI report, the company estimated that MSBs could be worth an additional £20bn to the UK economy if properly supported.
In a corresponding opinion piece, Katja Hall states: “With the UK’s global share less than 4% in 2012, only half of what it was in 1980, we need to actively encourage our high-growth medium-sized businesses to embark on the transition from non-exporter to global business.”
“MSBs already make a significant contribution to our economic well-being, creating jobs and prosperity in all regions of the UK, but not enough are making the most of opportunities overseas. A major piece of the puzzle on this journey for companies is their access to export finance.”
The five steps outlined in the report are:
- Building the knowledge and confidence to go abroad
- Boosting practical knowledge of doing business overseas
- Growing from successful exporter to international business
- Investing for greater rewards
- Becoming a truly global business
Mid-size firms have come under increasing scrutiny in the past 12-months, with a string of studies and stories highlighting their important to the economy, such as that by GE Capital and Warwick Business School in June.