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DHL/BCC Trade Confidence Index shows increase in exports
Monday, 23rd July 2012
The fifth DHL/BCC Trade Confidence Index, a measure of the UK’s exporting health, reveals that expectations for the “super summer” of 2012 has been overshadowed by the Eurozone crisis and concerns around currency fluctuations.
The report, which draws on a survey of over a thousand exporters and an analysis of export documentation (required of all companies exporting goods outside the EU) found that 40% of firms stated that exchange rates were a concern, showing the Eurozone crisis’ impact in terms of UK competitiveness and the buoyancy of one of its biggest markets.
A net balance of just +21% of firms felt profitability would increase in the coming 12 months, down from +30% the previous quarter, with falling profitability expectations across all firm sizes.
These results were in spite of a summer of celebrations and high hopes for the economic impact of the summer on exporters. They are in stark contrast to research conducted in 2010 by DHL, which found that 56% of businesses anticipated that the focus on London over this period will create greater global demand for British goods.
However, the latest Trade Confidence Index showed an increase in the number of firms reporting an increase in export orders, up from +39% in Q1 to +49% in Q2.
Anne White, Head of International Trade Thames Valley Chamber commented: “In the Thames Valley, although things have slowed down from Q1, we have continued to see an increase in export documentation requirements in Q2, showing an increase in over 8% on same period in 2011. This demonstrates the increased confidence in international trade in this region.”
Phil Couchman, CEO of DHL Express UK and Ireland said:
“SMEs’ concerns around exchange rates and profitability highlight that there is still more to be done in terms of support for British businesses who are venturing into overseas markets.”
“But recent export figures are strong, and there is reason to believe that the “super summer” – a once in a lifetime opportunity that will put British businesses firmly in the spotlight – could present a fantastic opportunity to make inroads internationally.”
“To sustain momentum, businesses large and small should start thinking now about how best to serve this international audience once the events are over, by initiating an export programme for their goods and services to reach that target market.
“The worries highlighted in the report show that businesses should seek advice from professionals with a local presence who can provide specialist insight.”
Full report available here http://www.thamesvalleychamber.co.uk/uploads/Trade_Confidence_Index_Q2_12.pdf