How to unleash the export potential of small businesses

The untapped global potential of small businesses in the UK is a missed economic opportunity we can no longer afford to ignore. Despite their agility, only 10 per cent of these firms trade internationally. Imagine economic growth if we could double that figure.

The Federation of Small Businesses (FSB) has this week revealed its SME Export taskforce — a transformative blueprint designed to remove the obstacles that prevent small firms from seizing global opportunities.

We were asked to lead this taskforce by Jonathan Reynolds, when he was shadow business and trade secretary, and gathered insights from big companies, small companies, and trade associations to help form the final document.

The findings are unequivocal: the trade support system is a labyrinth that hinders rather than helps. Government support is fragmented, and confusing, and small firms often lack the guidance needed to navigate the complexities of international trade. So the taskforce identified five changes to revolutionise the system and unleash the export potential of small businesses.

First, a cross-Whitehall approach to policy is essential. International trade must be prioritised across all government departments, who must all be aware of trade goals and actively contribute to trade negotiations. Aligning domestic and trade policies ensures the UK maximises the benefits of free-trade agreements.

Second, fostering an open relationship with the business community is crucial. Trade legislation and agreements must be crafted through transparent, honest dialogues that prioritise the needs of small firms. Similarly, establishing a senior exports council will ensure ongoing, meaningful engagement with the business sector, keeping policies relevant and effective.

Third, the UK must take the lead in digital trade. Embracing paperless trading across the global supply chain will significantly reduce administrative red tape and improve efficiency, making international trade more accessible for small firms.

Fourth, small and medium-sized enterprises (SMEs) need immediate support when they venture into international markets. Providing robust expert guidance, showing what is possible and addressing concerns that may hold back potential exporters, is critical. From day one, SMEs should have access to the resources and support necessary to thrive globally.

Finally, addressing the finance gap is imperative. Small businesses require better access to trade finance and reduced financial barriers to trade. This will enable them to seize international opportunities without the daunting financial risks that currently deter many from exporting.

The potential benefits of these changes are huge. By cutting the red tape and providing clear, actionable support, we can help small firms trade globally with confidence. After all, exporting is the ultimate growth hack for small firms: it allows them to grow quickly and stay resilient during tough economic times.

The priorities we’ve set out could fundamentally change how small businesses view and engage with global markets.

The path forward is clear, the rewards are significant, and it’s time for small firms to take their place on the global stage — backed by a supportive framework designed solely for their success.

Tina McKenzie is policy chair at the Federation of Small Businesses