Q&A: British exports carve out a path to innovation and productivity

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Exporting puts businesses in contact with customers who have different experiences and capabilities. That can feed into product development, which can create a plethora of opportunities. Innovation and inspiration can spark from anywhere.

Even picking a few key markets encourages companies to get much closer to their customers and their environments. That closeness could help them to solve customer problems, or equally dangle something exciting in front of people that sets them apart from a home-based business. Selling globally can also open doors for products that haven’t necessarily done as well domestically, giving them the latitude to find a new audience overseas.

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According to HMRC data, UK businesses that declare international trade in goods are some 70% more productive on average than non-traders. This is likely because organisations that choose to export will actively develop their reach to connect with customers. Productivity and innovation often fuel one another.

Automation plays a pivotal role in allowing firms to work more efficiently. One of the ways Royal Mail is helping companies is through our international tracking capabilities. If you have visibility on the item leaving the country, arriving in the destination country, going through the customs process and then being delivered to the customer, you can streamline that journey and eliminate uncertainty. We’re automating a lot of that, so customers don’t need to chase tracking updates individually, for example.

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The internet has made the world incredibly small. It’s frustrating as a consumer when you find a product you like online is available in another country but that company doesn’t ship abroad.

A lot of people don’t realise that trading across borders can be straightforward. It’s a little bit more work than sending parcels domestically, but we hold customers’ hands through that process and make it as simple as possible. We’ve developed our Click & Drop journey, which talks businesses through all the questions they need to answer. You can’t print the label until you have provided all the data, so you know every box has been ticked.

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There are four areas in which exporting can stimulate and support innovation: connectivity, diversity, speed and competition.

Connectivity, because companies are plugging into different markets and their unique needs, which presents jumping-off points for innovation. The diversity of the customer base can help businesses reach different customer segments that they may otherwise never be exposed to. The speed of online interactions, particularly on social media, enables innovation to happen much more quickly. And the increased competition in cross-border ecommerce can lead to new ideas as businesses seek to differentiate their products from their rivals at home and abroad.

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We’ve seen examples of people going on a family holiday and coming up with an idea, building it and then growing and expanding it by exporting. We see very small startups that have started selling in the UK but want to try international markets, through to multinational businesses that send truckloads of parcels daily that come through our distribution centres.

One UK company that has successfully expanded its product range through exports is Spice Kitchen, which started out selling Indian spice tins on a market stall in Altrincham and now sells a variety of different spice tins to customers all over the world.

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There’s a huge amount of untapped potential. Brexit did knock confidence and many organisations changed their export strategies, but a lot of those organisations are getting back up to speed. So, there is scope for additional export capabilities. Opening up to the idea of cross-border trade can create substantial growth opportunities, upping their competitiveness and increasing profitability.

More businesses expanding into international trade is good news for the economy too, contributing to increased GDP, jobs and incomes. As many as 152,000 full-time jobs could be created by small and medium-sized businesses if they were to export, according to a study by the Social Market Foundation.

And it doesn’t have to be all or nothing. Small businesses especially may be daunted by the prospect of exporting thanks to a lack of resources, capacity and skills. We also partner with online marketplaces such as Etsy and eBay to enable our customers to sell through them and dip their toes in the water for export.