Why E-Commerce is key to small firms unlocking benefits of exporting

By Marco Forgione, above, Director General, Institute of Export & International Trade

Small businesses are the lifeblood of our economy, and getting more of them trading internationally is essential to sparking growth in the UK economy. The scale of the opportunity here is stark. In the UK it is estimated that more than 99% of businesses are SMEs, but that only 9% of these export.

This gap signifies a challenge we urgently need to confront. After all, evidence shows that businesses that export are more sustainable, more resilient, employ more people, are more innovative, and are more profitable. Exporting not only benefits individual companies but also drives overall economic growth.

It is an economic and social imperative that we normalise conducting international trade as just a standard part of doing business. Only by doing this can we tackle key challenges such as low productivity and economic exclusion, as well as building resilient and anti-fragile supply chains which are essential in facing up to the current geopolitical forces and the ongoing weaponisation of international trade.

I firmly believe that to close this gap, small businesses can harness the power of e-commerce, which accounts for between a quarter and a third of UK retail sales. Yet despite its huge potential, e-commerce exporting is often overlooked in political discussions. We need to change this, gathering policymakers, businesses, and the public to recognise the huge potential of e-commerce exporting.

This week marks the UK’s first ever E-Commerce Week, which aims to empower entrepreneurs to harness the global reach of online commerce. By providing resources, guidance, and inspiration, it aims to highlight the benefits and offer support on overcoming barriers of international digital trade, helping businesses of all sizes recognise the value of e-commerce.

I’m proud to chair the E-Commerce Trade Commission, which is behind E-Commerce Week alongside a coalition of industry leaders including Amazon, Alibaba, eBay, Google, and Shopify. This group is dedicated to bolstering the UK economy by encouraging 70,000 more SMEs to embrace digital trade. The potential impact, if we succeed, is massive, with studies indicating a £9.3 billion boost to the economy.

SME Publications/ SME XPO 2024

At the heart of E-Commerce Week is education. In a recent poll of IOE&IT members, a majority (60%) of respondents stated that greater expertise in international trade is essential for them to increase exports. Two-fifths (40%) said a need for employees skilled in customs procedures was important, while a fifth (20%) stated that export training and support would enable their business to export more.

Trading cross-borders can be a daunting prospect for small firms but with the right knowledge and support, these barriers can be overcome. Through webinars, workshops, and practical guidance, it is vital that we equip entrepreneurs with the tools they need to thrive in the global marketplace. Platforms such as Facebook Marketplace and TikTok Shop represent exciting avenues for SMEs to reach global audiences.

I’m delighted to be a part of the first ever E-Commerce Week in the UK and look forward to engaging with current and future business owners keen to see their e-commerce dreams become a reality. Whether you’re a current small business owner or have an idea for a business that you’re looking to bring to life, exporting via e-commerce should be a part of your planning for success.

SME Publications/ SME XPO 2024