Small Businesses Benefit from International Supply Chains

Small and medium-sized enterprises (SMEs) in G7 and BRICM¹ economies that reach international markets are twice as likely to be successful as those that only operate domestically², according to a study which surveyed 410 SMEs. Of the SMEs surveyed by U.S.-based IHS Global Insight and DHL Express, 26% of those that traded internationally also significantly outperformed the market, while only 13% of domestic-only SMEs also outperformed the market.  SMEs cited several key benefits of an international approach, including access to new markets and technology as well as stronger diversification of their products or services.

The study also highlighted that an inadequate business infrastructure can constrain a company’s competitiveness due to the reduction of business efficiency.  For example, SMEs have to work harder to overcome infrastructure inefficiencies, particularly compared to larger companies with greater resources. The most significant concerns for SMEs that trade internationally are the lack of available information on foreign markets, high customs duties, the difficulty of establishing contacts with foreign partners and ability to successfully generate an overseas customer base.