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Entrepreneurs ready to go with exports

Entrepreneurs are eagerly waiting on the export starting line, however few are relying on funding from the banks to capitalize on opportunities in emerging markets.

This week marks 2012’s Global Entrepreneurship Week, hosted by the UK’s Youth Business International, which released statistics that showed optimism was high amongst entrepreneurs, with nearly half who said they predicted the business environment would improve in the next two years.

With 29% of business people planning to export to new, growing markets, and nearly a third already doing this, many entrepreneurs said they would not be going to the banks for development funding.

There has been increasing interest in emerging markets within the entrepreneurial community, although 45% currently export to traditional markets, and 20% are considering this avenue as an option.

Lack of knowledge was identified as a key barrier to getting into emerging markets such as India, China, Brazil and Russia, while just 12% of entrepreneurs said they would go to a bank as their primary source of funding.

Deloitte’s Head of Entrepreneurial Business, Mark Doleman, said strong, sustainable growth would heavily rely on revenues brought in from international markets.

He commented: “Entrepreneurial businesses are at the heart of the UK economy and have the potential to move Britain away from the alternating periods of recession and slow growth that have marked the last five years.

“Measures including tangible support to aid international expansion and a national insurance break to encourage recruitment would provide a welcome boost.”

Supply chain development, finance, distribution and sales networks will be the main hurdles that businesses must overcome, while 23% said these elements were the biggest obstacles to increasing exports to emerging markets.

Uncertainty is still a hindrance to some businesses who wish to export, and 32% of company owners said they had stockpiled cash or assets to safeguard themselves against economic instability.

Almost a third of entrepreneurs said revenue was lower than anticipated in the last year, while 27% suffered a fall in profits.

Despite these figures, the number of revenue disappointments was lower than last year, and 62% said profitability had been maintained or improved in the last 12 months.

Associate professor at London Business School and chair of Enterprise 100, Keith Willey, said: “Entrepreneurs must take risks, but they can’t risk it all.Innovation remains the key to success, not just the original founding idea but through the growth phase of the business too.

“Sustaining growth gets tougher as entrepreneurs encounter the big, established competitors but success stories exist, many of them technology-based. These are the entrepreneurs to whom others should look for inspiration and business lessons.”

Mark Doleman concluded: “The UK’s entrepreneurs are on the one hand uncertain of the future, but on the other, they are eager to export and are actively preparing for growth.

“This is a great time to be an entrepreneur. The internet is breaking down barriers in export markets and making the world a far easier place to do business, whilst market conditions are ripe for enterprise.

“There is uncertainty but true entrepreneurs see only opportunity and cannot wait to seize it.”

This was posted in Bdaily's Members' News section by Miranda Dobson .