East Midlands Businesses Export Their Way Out Of Recession

Posted on 13. Jul, 2010 by editor in Business News

A recent evaluation of activities delivered by UK Trade & Investment over the last three years has revealed that for every pound invested a cumulative return of £44 is anticipated.

emda invested over £900,000 into three of UKTI’s projects from 2007-2010 and in terms of impact to date and cumulative outcomes expected, a return on investment of 1:15 and 1:44 respectively has been recorded – a much higher figure than other business support interventions.

The projects focussed on helping companies in the region’s primary Sectors; on assisting companies to enter the more difficult High Growth Markets; and on Language and Culture support.

Activities included meet the buyer events, overseas market visits, language and culture seminars and support for the highly successful East Midlands International Trade Network, EMITA – all aimed at helping both new and experienced exporters to engage in international trade effectively.

Across the three emda funded projects, more than 1,800 businesses have received help from UKTI to improve their performance.

When asked, 50 per cent of respondents stated that they had benefited from increased demand from an overseas market in the last year, with 36 per cent stating that their profits had increased due to their improved approach to exporting.

Despite the recession, more than 25 per cent of businesses surveyed hadn’t been affected. Three quarters are expecting to achieve turnover growth over the next 12-18 months, with the majority expecting growth of more than 10 per cent.

Peter Hogarth, International Trade Director for UKTI East Midlands, said:

“The 1:44 ratio is a tremendous achievement which compares very well with other business support interventions.

“By working with UKTI, businesses gain an improved awareness of market opportunities, a better understanding of how to do business in an overseas market and build the confidence to explore new markets or expand in an existing one.

“Motivations for international trade vary from business to business. Some companies have exported their way through the recession and achieved their growth aims. Around half of the companies engaged were interested in exports as a way of reducing their dependence on the UK market.

“emda’s funding made it possible to deliver more activities than we could have done otherwise. It is clear that businesses in the East Midlands are benefiting from this and that a broad spectrum of industry sectors are taking full advantage of the overseas opportunities that are available.”

John O’Reilly, emda’s Business Support Director, said: “These results demonstrate the successful partnership that emda has formed with UKTI to support East Midlands businesses which are looking to expand into overseas markets.

“We have worked closely with UKTI to enable businesses to undertake overseas trade missions, to give support with languages and to help establish and run the East Midlands International Trade Association, which provides businesses with information and help to access overseas markets.”

The East Midlands has been one of the country’s most successful exporting regions being at or near the top in terms of the value of exports per employee. It is one of only a couple of places in the country with a balance of payments surplus on goods.

According to independent research exporting businesses are more productive and competitive than those who only trade in the UK – and that starting to export makes companies more competitive and productive.

Exporters have been benefiting through the downturn by spreading their risk across several markets, selling to countries that have been less affected by the recession than the UK. The drop in the value of sterling has led to increased profits from export markets balancing drops in profits at home.

The region’s primary export market remains the EU, though for the first time sales there have dropped to below half of total exports. Sales to more distant markets have increased.