The latest edition of WorldFirst’s Global Trade Barometer has found that nearly half of SMEs predict export volumes will stall or drop over the rest of the year.
Of those surveyed during the second quarter of 2017, only 30 per cent currently export, against 52 per cent in the same period in 2016. Meanwhile, a third expect no growth and the proportion of those expecting less than 5 per cent growth rose from 20 per cent to 23 per cent.
WorldFirst economist Edward Hardy says: “More than 12 months on from the EU referendum, it’s clear that SMEs are still wary of volatility in currency markets and the disruption they can bring.
“The data shows that while SMEs were still happy to hedge their foreign currency exposure in Q2, many are hesitant to commit to longer-term hedging contracts.
“Whilst this may be rooted in uncertainty over cashflow, sales forecasts or other financial commitments, it could also be a sign of the first strains in the relationship between UK SMEs and global trade.
“While one quarter of data doesn’t make a trend, should this pattern continue, companies large and small will become more exposed to sharp fluctuations in currency markets.
“With Brexit talks still underway and September’s federal election in Germany, SMEs may find themselves unprotected just when they need protecting the most.”
At Beavis Morgan, our specialist advisers to UK SMEs are able to assist with all aspects of business performance including ensuring that adequate measures are put in place to protect the health of your business, both now and for the future.
Contact Steve Govey or your usual Beavis Morgan Partner for further information about how we can assist.
Further reading: Half of exporters yet to update trading plans
