The CBI commented yesterday on new research undertaken by GE Capital, showing how far the UK’s mid-sized businesses (MSBs) are behind Germany and France when it comes to exporting outside of the EU. |
Speaking alongside Vince Cable at the Leading from the Middle summit, the UK’s first-ever major business convention on the importance of UK mid-market companies to the economy, Katja Hall, CBI Chief Policy Director, said:
“GE Capital’s findings on exports are compelling. Just 17 per cent of UK MSB revenues come from outside the EU. That’s lower than in Germany, France or Italy. Only 15 per cent of UK MSBs have grown their revenues from China in the last 5 years. That is compared with 25 per cent in France and 23 per cent in Germany and Italy. This must change.”
Recognising the recent emphasis UK Trade & Investment (UKTI) has placed on MSBs, Ms Hall said:
“The CBI and UKTI recently led a joint delegation of 30 MSBs on a trade mission to Turkey, the first designed for this size of business. We worked closely with UKTI to develop a programme that really made sense for these firms. Companies on the delegation came home with new commercial opportunities and the contacts they need to help them grow overseas.”
Highlighting the scale of the challenge and also the size of the opportunity, she said:
“GE Capital’s research really highlights the disparities. The UK mid-market has the second-highest proportion of ‘gazelles’ - or ‘growth champions’ - when compared to the mid-market in Germany, France and Italy, but also the second-highest proportion of flat and declining companies."
“But what GE Capital’s research also found was that UK MSBs’ principle focus is simply staying in business. Survival rather than growth is the defining strategy of 26 per cent of the companies surveyed, more than in France and Italy and almost double that of German companies.”
“MSBs and exports are intrinsically linked, and we welcome the government’s moves to bolster the support they are offering to help MSBs looking expand overseas. It’s critical, because MSBs are our innovators and fundamental components of larger exporters’ supply chains.
“We totalled up the size of the prize last October in our report Future Champions. If the gap narrows so that there are more gazelles, as well as more slow-growing firms reaching a steady expansion rate rather than stagnating, MSBs could add £20 billion to the economy by 2020. That’s a lot of growth, and in a relatively short time.
“But we won’t achieve it if we carry on as we are. The neglected middle must become the nurtured middle.”