June brought news that the UK was finally beginning to tackle its long-standing trade deficit. But July's balance of trade figures failed to deliver a second consecutive month of rosy data with UKTI calling for more manufacturers to rise to the export challenge.
The Sunday Times published its International Track 200 which named the UK companies with the fastest growing international sales over the past two years of trading. The top 34 companies, including eight manufacturers, all achieved triple digit growth.
“Still not enough businesses export. And if they already do, not enough of them are going where the growth is.”
Nick Baird, CEO of UKTI
Ranging from electronics firms to clothes manufacturers and precision engineering to confectionary making, the breadth of their activities shows that manufacturers in any sector can succeed internationally if, as The Sunday Times’ editorial leader suggested, they are bold but balanced; taking the time to clearly assess risks and adapt to changing conditions while aggressively pursuing a clear international business vision.
Despite continued instability in the eurozone and constant promotion of rapid growth markets by bodies such as UK Trade and Investment (UKTI) as representing the best export opportunities, most on the list said they were focused on European and US markets for their success.
It’s a lingering comfort zone which galled Nick Baird, chief executive of UKTI, as he wrote for the supplement. The trade support body’s 100 most valuable export opportunities, all worth over a quarter of a billion pounds, are also all outside Europe and the US. “Still not enough businesses export. And if they already do, not enough of them are going where the growth is,” he wrote.
UKTI and others have been cracking this whip over the heads of UK companies since 2011 when prime minister David Cameron set a challenge to see 100,000 more firms start exporting in order to grow UK exports to £1 trillion a year by 2020.
But due to a persistently sluggish global economy, volatile commodity and raw materials prices, many firms have remained stubbornly risk averse and, where there have been bouts of manufacturing optimism recorded in surveys like the Market/CIPs Purchasing Managers Index (PMI) and the CBI Industrial Trends Survey, growth in orders has stemmed from domestic markets.
June and July brought a break to this trend. The CBI recorded the strongest growth in export orders for two years and the Markit/CIPs PMI also reported export growth. The impression of improving confidence was backed by figures from the Office for National Statistics in August which revealed the UK’s trade deficit had narrowed by £0.6bn in June thanks to increased exports. However, when the July trade deficit figures were finally released it revealed the deficit in goods and services had actually increased by £1.8bn in July to £3.085bn and the deficit in goods alone had increased by almost £2bn to £9.9bn.
Commentators are hopeful Q3 will prove stronger. That said, there remain many companies who will take some convincing that conditions are yet favourable enough to dip a toe in foreign waters.
Small and medium sized doubters are still struggling to catch the wind of export-driven growth for the UK, finding it hard to follow the UK’s exemplary range of larger manufacturers as they sail through the breakers of regulation, finance and resource availability which can knock a smaller firm down in the shallows.
Learn how to grow your exports at Export Connect 2013 – sponsored by UKTI
The Manufacturer is looking to assist manufacturing businesses to breakout of their comfort zone and increase their exports to various global markets.
On October 16, manufacturers will gather in London for the Export Connect conference to learn from regional experts about how to access markets including Asia, Eastern Europe (incl Russia), India, the Middle East, South America and North America.
Speakers at the event include: Sir Roger Bone, President of Boeing UK and Lord Green, Minister of State for Trade and Investment as well as a host of industry and regional export experts who will be on hand to answer any questions.
For more information visit www.themanufacturer.com/eventsite/export2013/ or call +44 (0)20 7401 6033
Don’t miss your opportunity to follow the lead of the growing number of UK manufacturers tapping into offshore markets and experiencing positive growth as a result.
by Jane Gray & Tim Brown
