What does Brexit mean for exporters?
Brexit is casting a large shadow over British industries at the moment. A combination of continued news coverage and uncertainty about the aftermath is fuelling caution. Despite this caution, British products remain in demand across the world.
The markets buying British products
Products made in Britain are seen as high quality. The single biggest purchaser of British made products is the USA. Two of our European counterparts complete the top 3, with Germany being the second largest market while France takes the third spot. What’s more, in countries like China and Brazil, where consumer power is increasing, we are seeing an increase of imported goods from a wide variety of British products.
While a non-EU country is our single biggest partner, the EU combined accounts for £235.8 billion of the UK’s exports, while the rest of the world buys £284.1 billion worth of British made products. Many people expect to see the gap between these figures grow larger after Brexit, as companies from the UK actively enter new markets to expand. Many people are also predicting that the price of exporting goods to other EU countries is going to increase.
What are they buying?
The biggest category of exports from the UK is related to motor vehicles. Vehicles and vehicle parts exports to the EU totalled £18 billion in 2016. The second largest product group is chemicals and chemical products. Along with products, the UK also exports services, the vast majority of which are related to the finance sector.
What does this mean for businesses in the UK?
At a time when our own domestic market is uncertain, looking outwards to bigger and more stable markets can help to secure and grow your business. The two biggest factors in where we export to are geographical location and the size of the economy. The high volume of exports to our neighbours, Germany and France, reflects this. While the USA, China, and South America are all markets we export to in spite of the distance. This is because the economies of these countries are so strong.
How do companies enter new markets?
Modern digital solutions have shrunk the business world considerably. A smaller investment in a new market can give you access to a far higher number of potential customers. British products are often seen as the high-quality option, so it’s important to ensure everything about your offering meets the expected standards.
These standards expected by local consumers require more than running your current marketing materials or instruction manuals through a trusted translation partner. A different market has cultural considerations and quirks you’ll be unaware of. Using a professional translation company ensures that when you present your company to the new market it goes exactly as you expect it to.
Logistics are now easier than ever. There are several options, either dispatching directly from the UK, selling to wholesalers in the target market, or setting up distribution in your target area, so you can fulfil all your orders. Many countries already have distribution services set up where you can rent a relatively small space while you test the water.
Predictions for Brexit are just educated guesses, and nobody is quite sure how it will all play out. However, just because we don’t know for sure isn’t a good reason not to act. If the doom and gloom predictions are correct, then your business will be in a stronger position to weather the storm. If the positive predictions are correct then you’ll remain strong but will have added additional markets to your belt.
Find out what exporters can expect in the event of a “No-Deal” Brexit >
