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The barriers preventing cross-border trade and how to overcome them


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  • Jun 18,2020
  • By Admin

British businesses that export their products or services internationally remain in the minority.

According to Government data, some 10% of UK SMEs export abroad, while 42% of large companies are doing so. Putting to one side the onset of the coronavirus pandemic, the general trend was that these figures were on the rise; indeed, exports have generally been increasing quite steadily. For example, the Office for National Statistics reports that UK exports increased by £9.6 billion (5.4%) to £188.3 billion in the three months to January 2020 when compared with the preceding quarter.

Nevertheless, there remains huge untapped potential. If we can find ways to encourage more businesses – just 5% or 10% more, say – to export their goods overseas, not only could it open the doors to significant commercial growth for the exporters, but it would undoubtedly boost the UK economy.

It begs the question, therefore, of what is holding businesses back from exporting?

First things first, we must obviously acknowledge that for many companies, it is simply not something they can or want to do. Their offering might be too niche or too localised; they might be perfectly content with their business as it stands, with no desire to branch out into new markets.

Yet for others, they will have a product – physical stock currently sat in storage somewhere – that is just as desirable, necessary or beneficial for markets abroad as it is here in the UK. It would seem that in these instances there are two key perceived barriers to exporting: knowledge and cost.

In fact, in May One World Express released a new study that was conducted independently among over 900 UK businesses – their size and sector was mixed. Below are some interesting findings (or you can read more about our research on Global Trade Review

  • 57% of the companies we spoke to are currently considering expansion into new international markets as they look for ways to ride out the coronavirus storm
  • 45% of decision-makers say the pandemic has made them realise they are overly reliant on one particular marketplace
  • However, 51% say a lack of knowledge about international markets prevents their organisation from expanding outside the UK
  • And 43% feel the cost of doing so would be prohibitively high for them to make a profit from the move

This snapshot demonstrates that international expansion is being discussed by business leaders – this is likely a result of companies’ usual customer-bases being depleted or entirely cut off by the pandemic. But, actually taking that leap to ready business operations to market, sell and distribute cross-border is evidently seen as an expensive and complex task.

In truth, these findings mirror conversations the One World Express team have on a weekly basis; CEOs have piles of stock that is selling steadily in one country, but they simply do not know how to simultaneously export into other markets. Interestingly, however, it is not nearly as complicated or costly as most would assume.

Logistics firms take most of the pain out of the process, and by comparing rates of different carriers, the costs quickly become very competitive.

Like every business decision, expanding into overseas markets will require research, strategy and investment. That is true of growing a company in general though. As long as the appetite for global growth is there and you have the right mindset, it can be achieved more quickly and more easily than many would think.

At One World Express, we are on a personal mission to help business leaders see the potential of cross-border trade and understand how to make it a reality. That is why we have been offering free consultations with businesses throughout April, May and June 2020 – if you are interested in learning more, get in touch while our fees are still waived.

Get in touch!