The latest unexpected FX rates have entered a challenge for businesses around the nation, however, the recent research has revealed that SMEs within the UK who are trading overseas are benefiting by seeing growth.
Research found that nine in ten small to medium sized businesses are actually seeing a benefit from the fallen pound and that it is in fact, showing an average of 16% in their margins. Due to this, 95% who are already exporters plan to take advantage and continue to grow their exporting plans.
While those who are exporting reap the benefits of a fallen pound, SMEs who are importing are seeing the brunt end – 81% have revealed that their business isn’t doing well with the drop in sterling. SME importers are watching their margins fall by an average of 13% while increased costs are soaring by 61%. Businesses who both import and export are feeling the most optimistic – 95% have expressed that the fallen pound has actually shown a good impact on their business.
Senior Vice President at Global Commercial Payments, Europe at American Express, Jose Carvalho comments;
“Exchange rates have a huge impact on UK SMEs with an international footprint, and on their ability to maintain their place in the local and global economies. Those already involved in exporting are seeing the business benefit, and whilst others currently focused on domestic activity might be daunted by the idea of exporting there are plenty of resources out there for ambitious businesses.
“Every day we work closely with small business owners to help them overcome the challenges posed by managing international payments and working capital. With the right tools and resources, your businesses can unlock growth opportunities both at home and abroad.”
Although a portion of SMEs are seeing the benefits, there are still businesses that fear the instability of rates. Over one quarter of SMEs say that the changes in currency shows signs of risks to come affecting their business in the future if it hasn’t already.