Julie Underwood

Now is the time to look overseas

I often get asked by businesses why should I export? The answer is simple. There are huge benefits to trading overseas. By spreading your marketplace widely you can automatically spread your business risk. The current situation with Brexit is a case in point, those companies which trade all over the globe are more protected against any change in their European sales position.

We also find our exporters become more innovative as they learn about a host of different practices by travelling overseas and seeing how other enterprises and business cultures operate.

Here in the North East we have a proud tradition of exporting and many companies sell to the far corners of the globe. Our role is to encourage more businesses to explore overseas trade and to take away the fear that some people have. Yes, it can be a challenge, but it is also potentially very rewarding financially and, dare I say it, can even provide a good deal of fun along the way.

We recently helped 13 North East beverage specialist companies including Camerons Brewery, (who took their Motorhead beer) and Poetic Licence to attend China’s largest food and beverage trade show, FHC in Shanghai. There is a massive publicity opportunity for these firms as there was live streaming of the conference throughout China, reaching billions of consumers. The exporters also attended a Meet the Buyer event where they all showcased their products.

Feedback to date has been excellent. The firms who went to China, both large and small enterprises, reported it was useful for them and a number plan to go back to follow up strong business contacts with agents and distributors.

Many people who export start small and local, then develop their confidence and feel ambitious to try and trade further afield.

We have a whole range of sectors and countries’ trade shows lined up in the coming year, which give our North East businesses the chance to grow their client base.

With our Northern Powerhouse partners, for example, we are taking a mission to the Paris Maison and Object exhibition and then life science companies are going to UAE for the Arab Health Fair. There is also a new to export mission to Berlin in February with a focus on digital and creative businesses.

We have specialist advisers who support companies to attend these events at every step of the way.

I think many people don’t probably appreciate the scale of our exporting businesses. Here at the Chamber we help most of the region’s major exporters as well as SMEs with practical help with all their documentation needs, whether that is certificates of origin or what currency to be paid in.

The value of these documents equates to around £500m worth of shipped goods every four months. So you can see the real boost international trade gives to our North East economy.

The statistics available for 2017 show our exporting is growing as well. Exporting growth value for the year up to June was up over 6%. There are over 3,700 exporters in the North East, selling exports around £6,316m – which is the highest exporting figures have been for the past four years. The EU is the main destination for our goods with 58% going there, followed by Asia. In terms of goods, transport and machinery made up 57% with chemical in second place at 21.2%.

However, despite this growth it is of concern that so much of our trade lies within the European Union. In November 2017 the Chamber presented a detailed report to the Government’s Public Accounts Committee on the proposed Customs Bill. The comments were based on round table sessions with a number of our members with HMRC and HMT. The findings do not make comfortable reading. During our research it was clear many businesses are not prepared for a different trading regime with the EU. Indeed for many of our companies, they have never traded with a different area of the world where detailed documents are required. It is a case of ‘you don’t know what you don’t know’.”

The actual logistics of getting firms ready to go through new procedures and paperwork to do what they had previously done easily, is not only going to be a challenge for them practically, it could also lead to problems in speed of delivery of goods and extra costs, in terms of tariffs.

We are campaigning to get clarity from the Government on Brexit so that businesses can prepare properly for what is to come. There has been some details released but there is still massive uncertainty for companies.

Through our work we also see such great opportunities for growth which might be lost. The sums available to support exporters need to be increased, so more firms can take their first step to expanding beyond the North Sea. We need to get out of the Little Englander view some firms have and grab the chance to sell to the world.

One particular success story is a Darlington company, Beanies, the flavoured coffee business, exporting to 20 countries and selling into 110 stores in Denmark.

Brexit does present challenges for the North East but those companies that prepare and look further afield will undoubtedly thrive and give our local economy a boost along the way.

Published: 24 January 2018

Article by Special Feature: North East England Chamber of Commerce
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