DHL Survey: Globally-focused SMEs Are More Likely To Succeed

A DHL Express macro-economic analysis  and survey on 410 directors of Small Medium scale Enterprises (SMEs) in G7 and BRICS (Brazil, Russia, India, China and South Africa) countries shows that internationally-focused SMEs have a double chance at succeeding than domestic  inclined ones.

According to the DHL Express study, 26 percent of the companies that traded internationally significantly outperformed their market compared to 13 percent of those whose operations are home-based/ locally focused.

It says international trade and cooperation has become a key driver of small business success globally.

The results are an eye-opener for African SMEs, who are increasingly being recognised as economic drivers in their countries. It says SMEs with an international outlook had access to new markets, technology, and a diversified market for their products and services

Managing director for DHL Express Sub-Saharan Africa, Charles Brewer said possibilities provided by new technologies, the Internet, and modern transportation services means that there are greater foreign trade opportunities out there for African businesses.

"With thorough research and a well-defined strategy, local SMEs can successfully expand into new markets, compete with larger companies, and use their size and nimbleness to their own advantage," he said.

The study indicated that, "While no verified data is available around the number of SMEs operating on the continent, they make up over 90 percent of formalised business within countries like Ghana and South Africa, and are important areas of development within Ghana."

Citing increasing pace of globalization and a sharper international focus among smaller businesses; the survey shows that SMES established five years ago are more inclined to have international business operations than older SMEs, despite having less time to develop their business.

The majority of SMEs that out-performed their markets over the last three years also indicated that they plan to increase their exports over the next three years despite the uncertain economic environment.

However, SMEs are concerned about lack of available information on foreign markets, high customs duties and the difficulty of establishing contacts with foreign partners and an overseas customer base.

"There are clearly still some hurdles that remain for small businesses with global aspirations, but we are delighted to see that more and more SMEs are looking at the fantastic opportunity that international trade represents," said DHL Express chief executive officer Ken Allen.

"Our mission as a global logistics company is to make this process more efficient, and we will continue to tailor our services and solutions to help SMEs grow and compete in the global village," he said.

The study was conducted by IHS, a leading global research company on behalf of DHL, a global market leader in the logistics industry.