It has been well documented that Irish SMEs, although more innovative and highly skilled in comparison to their European counterparts are performing lacklustre when it comes to exporting. Why are Irish SMEs not exporting more?
Despite a good level of assistance for exporting being available overall, it has become evident that a more aggressive and pro-active approach is required when it comes to fostering SME exports in general, and fostering exporting for smaller businesses of 10 employees or less in particular.
A structure is needed which will be able to provide the necessary advice, mentoring and support to grow small businesses into successful exporters, and to create and cultivate micro-multinationals on a larger scale across the counties.
Specifically, this would mean providing the new and inexperienced exporters with capability assessments, support in visiting potential markets, mentoring from a local export professional, action plans, tailor-made training, and ongoing support.
Developing SME Exporting Skills
A programme should be put together defining one simple responsive process with all the tools that exporting companies need to grow their business. Inspiration can be found in other EU countries, such as the UK, who have successfully created and implemented similar incentives (e.g. Passport for Export) which could be tailored to the needs of the Irish businesses, providing:
- proactive advice from an appointed Export Advisor to identify the needs of the business and to determine a strategy appropriate to the business,
- identification of the specific international trade skills required for the company’s goods or services,
- specifically tailored training workshops and market visits, including advice on international market research/potential analysis, export marketing, administration, documentation
- cultural awareness and events and workshops to support these activities in context of different market entry strategies.
Funding for Professional Advice
In a similar vain to the currently available inter-trade trade accelerate vouchers which provide financial support for expert advice, an export accelerator voucher should be made available to enable small businesses to avail of impartial expertise to help their business trade across the international markets, gain better understanding of the international market opportunities, identify solutions to overcome international business barriers and gain wider knowledge of the practical considerations when trading internationally (financial, tax, legal, currency, regulation etc).
In co-operation with existing international and bilateral Chambers of Commerce and with commercial departments of various Embassies present in Ireland, an advisory network on cultural and language issues could be developed, which could offer practical help in terms of establishing an effective communication strategy which would address issues such as reviews of company’ marketing approach, written materials, personal meetings with customers or agents/distributors and general administrative issues that may arise.
Crucial Role of the Business Owner
Another significant obstacle to exporting that needs to be tackled is the mindset of small business owner-managers. The barriers to export are perceived to be much higher by those who do not export. A key barrier to internationalisation is motivation. International activity is an investment decision requiring long-term commitment but which would be giving the company long-term security. We need to convince business owners to abandon short-term thinking and help demystify new markets.
We need to assist the small businesses to develop at least basic export skills and educate them on resources and access to export assistance agencies that are currently available, some of which are provided to the business at no cost. In addition to this, specific assistance is required with research, planning, strategy review, and developing a well thought-out individual market entry programme. Delivery of professional advice is crucial, whether public or private.