UK small and medium-sized (SME) online retailers seem to be increasingly confident that they cangrow their international sales this year, according to Royal Mail’s latest study.
The results of the annual tracker study into the expectations and challenges facing UK SMEonline retailers have shown that two-thirds (65 per cent) of the e-retailers surveyed aim toincrease their international sales this year. This is quite an improvement on the last year whenonly four in ten (39 per cent) of the respondents were planning to increase their overseas sales in2014.
The study also found that the UK SME online retailers are generally in a positive mood forthe year ahead, with seven in ten businesses expecting their overall sales to increase. Theoptimism for growth level has thus gone up by 9 per cent on the last year, despite the fact that 76per cent of the e-retailers surveyed claimed competition is now stronger than a year ago.
To further support growth, eight in ten (84 per cent) of the companies said that they plan totarget new countries which they are currently not selling their products to.
In terms of regions, the USA has overtaken Europe as the top target for online retailerslooking for new international markets. This is in line with this month’s forecast fromInternational Monetary Fund that the US economy is due to grow at 3.6 per cent in 2015, compared toonly 1.2 per cent for Europe. Meanwhile, the dollar has become stronger while the Euro hasweakened. That makes the British Sterling more competitive in the USA than in Europe.
While four in ten (39 per cent) of the e-retailers plan to target the USA, compared to 23 percent a year ago, 30 per cent want to focus on European countries. Canada ranked third in newinternational target markets for UK online retailers, the study revealed. Despite the devaluationof the Russian rouble, 15 per cent of SMEs said they would target Russia this year, up from only 9per cent last year.
This year, respondents named online search activities and targeted direct mail or cataloguesas the best ways to develop new sales opportunities. Over half (56 per cent) of the SMEs plan toinvest in online search improvements to win new overseas customers, up from 32 per cent a yearearlier while 47 per cent want to use targeted direct mail or catalogues, an increase of 10 percent compared to 2014.
Nick Landon, Managing Director of Royal Mail Parcels, said: “Royal Mail’s annual trackerstudy of UK SME online retailers shows that there is growing confidence that they can growinternational sales. There is a marked increase in the percentage of UK SME online retailers aimingto grow international sales in 2015, compared with 2014. The study found that UK SME onlineretailers believe there is strong potential in the USA, which has overtaken Europe as the toptarget for businesses looking for new international markets.”
