Helping SMEs to sell goods online could add billions to UK exports, boosting Britian’s growth and supporting thousands of well-paid jobs, according to new research from the E-Commerce Trade Commission.
Authored by the Social Market Foundation (SMF) on behalf of the Commission, which the Chartered Institute of Export & International Trade chairs, the report sets out 10 recommendations to government to boost the UK’s online exports.
This includes reviewing cross-border payments, an independent investigation of the UK’s export support networks, and an overhaul of the government’s export finance provision for small businesses.
No silver bullet
Many SMEs face additional barriers to exporting, including access to finance and additional trade costs, which require a number of changes rather than one “silver bullet”.
The report – named ‘Small business, big ambition’ – says that these targeted reforms and extra business support could help an additional 50% of SME sell their goods internationally. This would generate an addition £7bn in exports over the next decade and tens of thousands of well-paying jobs.
The UK is currently falling behind its competitor countries, such as Canada, when it comes to SMEs exporting, with the total amount of goods sold abroad by small businesses falling since 2010 by 10%.
‘Friction still clips the wings’
Marco Forgione, director general of the Chartered Institute, said that the report was a culmination of two years of research conducted by the E-Commerce Trade Commission, including focus groups held with businesses up and down the country.
“This report captures the voice of real businesses up and down the country. The ambition is there, but friction still clips the wings of too many firms.
“That’s why the Commission focused on practical fixes – logistics, customs, finance, fraud protection, payments – areas where smart policy can remove barriers fast.
“Digital trade is a high-growth route for the UK economy. If we give firms the tools they need, they will do the rest. That’s what this blueprint offers: a credible roadmap to help businesses scale across borders.”
Richard Hyde, a senior researcher at SMF and one of the authors of the report, said that many small businesses found their exporting journey blocked by “avoidable barriers”, such as customs processes, confusing VAT rules and poor support services.
“This report shows that with targeted, practical reforms, the UK can unlock the vast potential of SME e-commerce exports.”
E-Commerce Trade Commission
The E-Commerce Trade Commission was convened by the Chartered Institute and includes many of world’s largest online platforms, including Amazon, Alibaba and eBay.
Other members include the Federation of Small Businesses (FSB), the Institute of Chartered Accountants in England and Wales (ICAEW) and the Association of International Courier & Express Services (AICES).
Launch
The report was launched yesterday (24 June) at a final E-Commerce Trade Commission event, held at the headquarters of the ICAEW.
Alan Vallance, CEO of ICAEW, said that there are 70,000 businesses that have the potential to export their goods online but don’t currently take advantage of this, representing an extra £17bn for the UK economy.
“It’s so important that we do all we can to get this right, to help stimulate and facilitate global trade and empower business export their products and their services.”
The commission had a two year mandate, having been launched in 2023 by then trade minister Kemi Badenoch, following a 2022 report from SMF.
A trade knowledge base has also been launched to help exporters take advantage of various e-commerce platforms
