- The British Chambers of Commerce Trade Confidence Outlook for Q2 2024 shows most SME exporters overseas sales are flatlining.
- More than half of all SME exporters (52%) saw no change in overseas sales, and 21% reported a decrease.
- Just over a quarter of exporting SME firms (27%) saw their overseas sales rise in Q2.
- BCC’s SME export sale indicator has consistently underperformed compared to domestic sales indicators since the pandemic.
The Trade Confidence Outlook, conducted by the BCC’s Insights Unit, is a survey of just under 2,000 UK SME exporters. It shows the percentage of SME exporters reporting increased exports has been broadly static since the pandemic, with a slight three percentage point uptick in Q2. Overall, 27% of SME exporters reported an increase in export sales, while 52% reported no change, and 21% reported a decrease. SMEs are now more likely to report decreased exports compared to before the pandemic and Brexit.
In Q2 2018, only 14% of SME exporters reported a decrease in overseas sales, in Q2 2024 it stands at 21%. By contrast, domestic demand for SME exporters remains consistently more buoyant, with 37% reporting an increase in domestic sales in Q2 2024, against 27% for overseas sales.
The one bright spot is SME manufacturers, with 31% reporting an increase in exports. This compares to SME services exporters supplying end customers (B2C), where 25% saw an increase, while 24% of firms supplying services to other businesses (B2B) saw a rise.
However, the picture for advance orders was less rosy, as all three sectors show slippage, with 28% of SME manufacturers reporting an increase, 23% of B2C firms and 20% of B2B businesses.
William Bain, Head of Trade Policy at the BCC, said: “Our research shows the Government will have its work cut out in trying to revitalise UK exports, as they continue to underperform. But it has already taken some steps to help firms turn a corner. This includes its trade strategy announcement, restarting trade negotiations in vital markets, joining the World Trade Organisation’s E-commerce agreement and committing to improving our relationship with the EU.
“Legislation announced in the King’s Speech also has the potential to ease the problems of regulatory divergence for regulated products sold into the EU. Business wants to work with Government to put in place a framework that makes use of all the UK’s advantages and makes it easier to access incentives for exports. A focus on critical minerals supply chains and taking full advantage of the opportunities offered by digital trade would also have real value for our firms.”
