‘Help small firms to export’

A new report from the Federation of Small Businesses (FSB) shows a quarter of entrepreneurs export but are stifled by red tape and currency fluctuations.

David Knowles Leak, FSB Thames Valley Chairman, said: “With the UK economy in fragile recovery, a number of well targeted initiatives could be just the ticket that small business exporters and government are looking for to help the private sector led recovery.

“Manufacturing and defence are two sectors which offer big opportunities for small firms to export, but more effectively targeted information on the support that is already available is vital if small businesses are to be successful.

“The Services Directive offers huge potential in breaking down barriers to the single market, yet no small businesses surveyed were aware of it. With effective communication small firms can make more of this legislation and the opportunities it offers.”

The EU Services Directive makes it easier for service businesses to set up or sell their services anywhere in Europe. Most service sectors are covered, such as accountants, builders, vets, travel agents, hairdressers and business consultants.

High street banks are the first point of call for many businesses for advice on how to export, but the FSB says no businesses have utilised the Services Directive which came into force in 2009.

The government has hailed exporting as a potential driver for economic growth over the next few years. FSB research in 2009 indicated that only 10 per cent of annual sales from small businesses went to countries outside the UK, but recent research shows that almost 23 per cent of small businesses currently export and there is good potential for further growth.

The FSB is calling for more targeted promotion of the support available to encourage more businesses to export, in its report, ‘Made in the UK: Small businesses and an export led recovery’.

Businesses have said that this would be more beneficial than tax breaks and added private sector finance.

The FSB recommends:

> More effective promotion of government assistance available through UKTI, particularly the Passport to Export Scheme which helps businesses to export for the first time, as well as more tailored information on the support available for small manufacturers.

> An information campaign to be put in place about the benefits of the Services Directive and the benefits and availability of the web portals.

> The government and private sector to implement a trade credit scheme for small businesses

> The Ministry of Defence to work closely with businesses organisations to distribute information relating to opportunities in the defence industry to a wider range of businesses.