By Mark Robson, Regional Director, UKTI Yorkshire & Humberside
At the height of the recession which started in 2008, I went around talking to clients which trade overseas to varying degrees. My expectation was that many would be struggling particularly as access to finance tightened and the trade credit insurance market had pretty much disappeared overnight.
I was wrong, a good one third said they had never had it so good and most hadn’t noticed a change.
I should not have been surprised because there is a lot of evidence to show that businesses with a range of customers overseas are more profitable and resistant to shocks such as a financial crisis than those focused just on domestic markets.
The main reason is obvious: by spreading risk across a range of markets, countries and customers you don’t have all your eggs in one basket and are therefore less likely to be prone to major swings in one or perhaps two economies.
There are other reasons too: Businesses trading overseas tend to be more innovative than those that don’t, you can find markets where your product or service may command a premium price because it is new to the country and there is the opportunity to secure economies of scale by increasing volumes of services or products.
In 2008 there were real advantages to trading overseas and now, eight years later, with a rapid growth in online retailing and international connectivity, it is becoming more and more normal to be doing business internationally.
Children under 12 cannot recall a time when it was not normal to be able to call up cousins in Australia for face to face chats or order anything they want at any time from a screen or play online games with George in the US at night and Sam in Singapore in the morning.
The world is both going global and shrinking. In 2008 international spread gave you a competitive advantage. The landscape is shifting, and as it becomes the norm in the next few years, not having an international spread will put you at a distinct disadvantage.
To my mind therefore it follows that one of the key considerations when looking for new hires is to look for people with significant international knowledge, language skills and experience. Whilst there is a lot of support available from the public and private sectors to help businesses sell internationally, the thing that makes the most difference is bringing in staff with real knowhow and experience.
Although I am advocating spreading risk, if I had to bet on one thing it would be that employing someone with good international experience will lead to your business starting or growing internationally.
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