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Insider UK
Insider UK
Science
Peter A Walker

Scottish businesses are 'missing out on export opportunities'

Scottish businesses could be missing out on important export opportunities and the chance to grow on an international scale.

That's according Alibaba Group, which surveyed more than 2,000 UK businesses, finding that almost half (47%) of Scottish respondents reckon exporting is a viable opportunity – but are concerned about the challenges of cross-border trade.

The Chinese e-commerce group's research also showed that the biggest perceived barrier to trading abroad is increased paperwork and customs rules (31%), followed by supply chain issues (27%) and concerns about payment security or late payments (27%).

Meanwhile, a quarter of businesses highlighted shipping costs as another key obstacle to exporting overseas.

Against this backdrop, 44% of Scottish businesses believe they would benefit from professional advice from an export advisor to help them expand and succeed on the global stage.

Two fifths stated that more country-specific exporting information would enable them to export overseas, while 39% said more access to overseas marketing information would help.

Among the Scottish companies that do currently export overseas, 86% said they expect export sales to increase in the next 12 months. Nearly half (49%) are conducting more international sales online because it is more cost effective, while 47% have made the switch because it removes the need to travel.

Roland Palmer, general manager of UK, Benelux and Nordics for the Alibaba Group, said: “While it can be daunting to enter a new market, the opportunity for Scottish businesses to ‘go global’ could have a transformative impact on their future growth.

“By trading internationally, businesses of all sizes are able to expand, potentially creating more job opportunities and economic growth.

“The highest demand on our global e-commerce platform is in the food and drink, apparel and beauty/personal care categories – creating a strong proposition for Scottish suppliers who want to reach buyers worldwide.”

In a post Brexit-world, a quarter of Scottish businesses surveyed said North America represents the biggest export opportunity, while a further quarter highlighted the Middle East.

The demand for Scotland’s products across the globe has been highlighted in recent figures released by Scottish Development International (SDI). The support provided by SDI to companies across Scotland in the past financial year should result in £1.44bn of planned international sales over the next three years.

SDI hosted an event in Edinburgh on Thursday exploring how companies can leverage digital tools to connect them with new buyers around the world.

Speaking to Insider during it, Palmer said that traditionally Alibaba has been focused on helping brands buy goods from China, but far fewer businesses have explored selling their wares to other countries using the group's marketplace platform.

"Today we've been explaining to Scottish companies about the possibilities of exporting online, so those here today are the pioneers, I was just talking to the people behind the Edinburgh Natural Skincare Company for instance, who have recently launched in China and are now looking to export to many other countries.

"We've had a really good turnout - obviously food and drink is a stronghold, but others like beauty brands have been here, along with SMEs in personal care, textiles, sports apparel, home decorating and also more industrial machinery stuff."

Alibaba's moves into the UK really began at the end of last year, with this being its first big meeting in Scotland pushing the export side of things.

"After chatting to their new interim CEO, we're likely to be doing a follow-up event with Scottish Food & Drink - whisky and salmon are such fantastic export products, but there are so many others just behind them," Palmer said.

While traditionally, Scottish companies looking to grow via exporting have used distributors to enter foreign markets, he argued that replacing or complementing this approach with digital platforms can help reach many more new customers.

"Digitisation means you can begin exporting while still at a much smaller scale - it's relatively simple, with pretty low barriers to entry - for a few thousand pounds and a couple of months you'll be up and running."

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