MANILA, PHILIPPINES (6 September 2018) — Poor access to finance and a difficult business environment are holding back Asia and the Pacific’s small and medium-sized enterprises (SMEs) from contributing to the creation of economic wealth for development. An evaluation by the Asian Development Bank’s (ADB) Independent Evaluation Department sheds a useful light on how governments and their development partners can remove these barriers to unleash the development potential of SMEs in the region. Continue reading “Unleashing Small and Medium-sized Enterprises in Asia and the Pacific”
New research reveals more than one in three (38%) UK SMEs receive no payment terms from their customers.
Over half a million businesses give up on exporting due to chronic late payment problem
Long and repeated history of being denied access to working capital has left SMEs in a long-term cycle of despair.
New financing solutions can help break the cycle and will leave SMEs better prepared for leaving the European Union. Continue reading “Late payment epidemic set to cripple exports as over a third of SMEs left without contracted payment terms”
The Adaptation Sub-Committee of the Committee on Climate Change has today published a key report which reaffirms the real and growing risk of climate change to small businesses, and warns the risk of flooding must be addressed urgently.
The findings of ‘UK Climate Change Risk Assessment Evidence Report,’ also draws heavily from Federation of Small Businesses (FSB) research showing two thirds of small businesses have been negatively affected by severe weather in recent years.
Mike Cherry, FSB National Chairman, said: “This report recognises the great risk posed by flooding and extreme weather on small businesses. It also confirms the problems we have consistently identified with access to affordable small business flood insurance.
“Severe weather is expected to increase the severity and frequency of flooding, leaving vulnerable regions at real risk of greater damage and disruption. The economic fallout extends beyond those businesses who actually receive flood water through their doors. It disrupts supply chains, distribution channels and impacts whole communities.
“Small businesses need to be empowered to improve their own resilience. That should be supported by bringing flood insurance premiums down to an affordable level. Flood risks must also be tackled and defences improved so that businesses have the confidence to remain at the heart of their local communities.”
FSB research suggests up to 75,000 smaller businesses at risk of flooding could currently struggle to find affordable flood insurance. Small businesses are not covered by the new Flood Re agreement and so FSB is working closely with Government and industry to explore how best to increase resilience and reduce insurance costs for businesses in high-risk areas.
Only 25 per cent of microbusinesses have a resilience plan in place that specifically includes severe weather. Today’s report recognises Government has a role to play in supporting businesses to improve their resilience through policies, regulation and awareness raising measures.
The UK Climate Change Risk Assessment Evidence Report analyses risks and opportunities to the UK from climate change and will inform the UK’s second ever Climate Change Risk Assessment due out in early 2017. FSB will continue to work with Ministers, officials and the insurance industry to explore and agree solutions to small business resilience and the lack of available flood insurance.
Notes to editor
1) Committee on Climate Change Adaption Sub Committee, ‘Climate Change Risk Assessment 2017 Evidence Report’, 12 July 2016, https://www.theccc.org.uk/uk-climate-change-risk-assessment-2017,
2) Federation of Small Businesses, ‘Severe Weather: A more resilient small business community’, July 2015
As experts in business, FSB offers members a wide range of vital business services, including advice, financial expertise, support and a powerful voice in Government. Its aim is to help smaller businesses achieve their ambitions. More information is available at www.fsb.org.uk. You can follow us on twitter @fsb_policy.
New FSB report reveals huge opportunity to double the number of small business exporters
- Potential for small firms to make greater contribution to exports market
- Finding customers remains the biggest challenge to small firms wanting to export
- Established export markets – including Europe and North America – remain dominant but emerging markets are making headway
The Federation of Small Businesses (FSB) has today (Monday) published a comprehensive report exploring the way small businesses interact with the global export market. “Destination Export: The small business export landscape” highlights key characteristics and drivers of small firms that currently export and, crucially, the potential exporters of the future. The focus on potential exporters offers insights into what more could be done to move the dial on growing the number of small firms selling overseas.
The proportion of small businesses exporting, one in five, (21%) has remained static for many years. One of the key findings of this report is that the number of small businesses currently exporting is matched by those that would consider exporting (21%). This points to the huge potential to double the number of small business exporters. In order to tap into this potential, the Government, the private sector, the finance industry and business associations including FSB, must now focus on providing effective targeted and tailored support.
The most common challenge facing small firms in exporting is finding customers, followed by marketing their product to overseas customers. For those currently exporting the most common challenge remains foreign exchange rates. While for potential exporters, there is a pervasive knowledge gap to overcome – one in five small firms that would consider exporting do not know where to go for support. This report also found there are issues around confidence in trading overseas and an assumption by some small firms that exporting is not for them. Yet there are clear benefits with the average annual turnover of an exporter (£935,921) more than double that of a non-exporter (£390,028).
Martin McTague, FSB National Policy Director, said: “Small businesses that export are more likely to survive, grow and innovate. But in addition to more traditional barriers such as language and foreign exchange, businesses are having to deal with a rapidly changing export landscape and the advantages and challenges brought about by e-commerce. Any support must be designed with this in mind and should be able to cater to a wide range of export needs, both for those currently exporting and for those considering doing so.”
“The Government clearly understands the need to promote exporting given the decision in late 2015 to refocus UKTI’s role and make exports a priority across government departments. Small businesses are well placed to make a significant contribution to the Government target to increase the value of exports to £1 trillion and support 100,000 new exporters by 2020. But the fact remains, many small businesses aren’t aware of the support available or how to access it. This report provides some critical insight into the kind of support small firms need at different points along their export journey and provides key recommendations on how close the gap between demand and delivery.”
This exports report has been researched and written against the backdrop of campaigning around the EU referendum. Given the UK’s decision to leave the EU, ‘Destination Export’ could not be published at a more uncertain time. Maintaining a stable and secure trading environment for small businesses must now be the priority.
Martin McTague continued: “FSB has clearly and consistently called for clarity on what the UK’s exit from the EU means for business, with particular emphasis on access to the single market and the free movement of people and trade. The majority of FSB members export to the single market with provides access to 500 million potential consumers, more than 26 million businesses and is worth around £9 trillion.”
The EU is by far the dominant export destination for small businesses with 93 per cent of exporters selling to countries within that trading bloc. But our report does point to signs that newer entrants to the export market are attracted to a more diverse range of destinations, especially emerging markets in Asia and the Middle East. Those offering support must seize this opportunity boost this trend and diversify the export market further by helping to provide market knowledge and practical information on logistics, delivery and translation services.
Current Government-backed support, particularly UKTI services, have made some headway with exporters. Our survey showed that of those who accessed export support, over a third (37%) used support provided by Government. But this report recommends one key way for UKTI to help maximise the chances of exporters getting approached by customers overseas. It’s Exporting is Great website allows UK businesses to search for export opportunities but there is potential to create an online platform allowing businesses to show their wares to overseas markets and increase their visibility.
The report, ‘Destination Export: The small business export landscape’ will be officially launched on Monday 18 July 2016 at an evening reception in the prestigious Admiralty House at the Heart of Whitehall. Attendees will be hearing from Lord Price CVO, Minister of State for Trade and Investment.