Credit Management December 2022

Exporters hit hard by falling trade
ACCORDING to a survey from the British
Chambers of Commerce (BCC), more small
and mid-sized exporters are reporting
falling overseas sales than are seeing
an increase.
The BCCs quarterly poll of 2,200
companies reported a drop in export growth
in the three months to mid-September, with
the percentage of companies reporting
growing sales dropping from 35 percent to
22 percent of the total. In contrast,
28 percent saw export orders
fall, while 50 percent reported
no change. It also found
that 39 percent of exporters
expected their profitability to
decline, compared with
34 percent expecting
an improvement.
The BCC said that
small firms 'are much
more exposed to the
combination of supply
chain disruption,
THE UK Government wants to drag trade
documentation into the 21st century by
giving digital documents the same legal
status as their paper-based equivalents.
The Government says laws dating back
to the 19th century demand that many
documents must be on paper and that by
going digital firms could save more than
£1bn over 10 years.
The proposals for change are in the
Electronic Trade Documents Bill which
was introduced to Parliament in October
and welcomed by Logistics UK as a
‘positive step’ since Brexit brought in a
‘significant increase in paperwork’.
Paperless trade plans
INVOLVED IN PETS?
SELL TO CHINA
ACCORDING to state owned Sixth Tone,
the pet industry is booming in China as
are pet detectives.
A recent report in the online
publication said that the value of the
domestic pet sector grew 18 percent
year on year to reach £25bn last year.
With nearly 100m households now
having a pet, ownership has grown 44
percent since 2014. And this has opened
up a huge market for pet detectives
who become heroes to happy owners
and often have a huge following on
social media.
The key point is that not only do
pet owners spend a small fortune on
their charges, but that pet detectives
buy in and deploy cat traps, nightvision
devices, monitors, alarms with
wireless transmission functions and
other devices.
In other words, there’s a huge
market in China for any exporter in the
pet sector.
soaring prices, and the impact of Brexit
red tape and compliance costs, than
larger companies.'
The survey was conducted before the
recent fall in the value of sterling against
the dollar.
As if to drive the point home, the monthly
S&P Global/CIPS Manufacturing Purchasing
Managers’ Index, published at the end of
September found that new export orders
fell in September and at their fastest
since May 2020. The index cited lower
demand from the US, China and
the EU.
It said that ‘manufacturers
faced weak global market
conditions, rising uncertainty,
high transportation costs,
reducing competitiveness
and longer lead times
leading to cancelled
orders.’ Of course, the
drop in sterling didn’t
help matters.
It’s hoped that the change will cut
processing times from days to seconds
in areas such as bills of exchange, ship's
delivery orders, warehouse receipts, and
marine insurance policies.
However, while the Government’s plans
have been welcomed, it’s been pointed
out that there needs to be a reciprocating
paperless system in any country being
traded with for the changes to work.
Beyond that are still problems with
systems such as the Customs Declaration
Service. It should be said that the
legislation will allow firms to go electronic
but won’t mandate change.
KNOW YOUR CUSTOMER
– AT LEAST IN ITALY
THE role of the mafia in Italian life
is well known, but it appears that –
as Bloomberg has reported – Italy’s
economic and social crisis is increasing
its vulnerability to organised crime.
In May, former Prime Minister Mario
Draghi warned that organised crime
had ‘insinuated itself into the boards of
companies’ and was working its way into
the economic fabric of Italy. It’s reckoned
that now criminal groups control around
nine percent of the economy.
Of concern to Draghi was the €260bn
of EU recovery funds, which he felt gave
the gangs a “fat new target”. Now, there
is worry that the mafia are acquiring
businesses at risk of default, as the
economic crisis takes hold. It doesn’t
help that SMEs make up 80 percent of
the economy and there’s been a real
growth of the organised crime groups
whose identities are concealed by a shell
company – who acquire small stakes in a
firm and gain effective control.
FUNDING AVAILABLE FOR
BUSINESSES IN ENGLAND
THE Internationalisation Fund is part of
a package of support available to SMEs
through the Department for International
Trade (DIT), which provides co-investment
of between £1,000 and £9,000 to help
them overcome tangible barriers to
internationalise their business and enter
new markets.
The fund is supported by the European
Regional Development Fund (ERDF) and
provides £38m split across four regional
projects – The Northern Powerhouse
Internationalisation Fund, Midlands
Internationalisation Fund, South
Internationalisation Fund and London
Internationalisation Fund.
While the London fund is now closed –
as at the end of September – there’s still
funding for other regions.
To secure a grant, firms need to fund
a proportion of their costs themselves
which varies according to where the
business is based and is either 40 or 50
percent of the total cost.
The fund can be used to support areas
including market research, IP advice,
translation services, international social
media/SEO, trade fairs, independent
market visits, consultancy and other
international commercial services.
Those interested should navigate to
great.gov.uk.
❝
To secure a grant, firms need
to fund a proportion of their
costs themselves which varies
according to where the business
is based and is either 40 or 50
percent of the total cost.
CURRENCY UK
EXCHANGE RATES VISIT CURRENCYUK.CO.UK
OR CALL 020 7738 0777
Currency UK is authorised and regulated
by the Financial Conduct Authority (FCA).
HIGH LOW TREND
GBP/EUR 1.16769 1.13206 Down
GBP/USD 1.20063 1.11076 Up
GBP/CHF 1.15715 1.10508 Down
GBP/AUD 1.81800 1.74588 Down
GBP/CAD 1.58954 1.51817 Up
GBP/JPY 172.075 163.395 Down
This data was taken on 16 November and refers to the
month previous to/leading up to 15 November 2022.
Brave | Curious | Resilient / www.cicm.com / December 2022 / PAGE 35