As we wait in trepidation for Brexit uncertainty to become stark reality, one aspect has already been making its presence felt – and in a positive way.
The latest data from payments provider PayPal shows that UK SMEs have had a boom time in trading abroad. Their sales leapt an incredible 34% in the second half of 2016, while the amount each international shopper spent was up 13% per transaction.
So, more international shoppers, spending more money. But why?
The spending power of overseas shoppers has increased due to the pound’s value against their currencies increasing. All other things being equal, they can buy more in the UK for the same amount of spending.
But PayPal is keen to point out that the currency rates are not the only reason. With British goods known for their variety, quality and exclusivity, some SMEs have taken advantage.
The data also shows that fashion and sports retailers have seen a 49% growth year-on-year in goods sold online internationally. “We feel like we’ve become a global company over the last six to nine months,” says Ian Bristow, founder and co-owner of outdoor fashion retailer Black Leaf.
“As a result, we are taking payments through PayPal in more currencies than ever before and the business is opening up to many new countries.”
Major concerns about trading abroad are well-known – these include the shipping and associated costs, customs and duties - and were picked up by PayPal in an earlier survey last year. A visit to the Department for International Trade website is a must for beginning the process of tackling these issues.
But with exchange rates so favourable, what can your business do to take advantage?
Back in 2015, the Royal Mail noticed an increased confidence in UK SMEs to sell abroad, and flagged up how these companies were looking to tap those markets.
Firstly, many SMEs said they were planning to invest in online search improvement to win new overseas business, while a significant number were looking at producing targeted direct mail or catalogues.
PayPal suggests recalibrating your online store to benefit international buyers. This could include letting shoppers browse in their local language and pay in their local currency. Another option would be setting up a simple returns service for customers to ship back unsuitable goods through a refunded returns scheme.
“There’s never been a better time for SMEs to broaden their horizons online. The world may be in an unprecedented state of flux, but UK small businesses have seen the opportunity and grasped it,” says Mark Brant, MD of PayPal UK.
Content on this page is paid for and provided by Kia Fleet, sponsor of the Guardian Small Business Network Accessing Expertise hub.
