As we move into a new year, it isn’t all doom and gloom. Here is a list of what will be the biggest challenges and opportunities for SMEs in 2012:
With the Eurozone economies reporting their fourth consecutive month of decline in December, the Euro crisis seems unlikely to significantly improve with the arrival of 2012. The issues have decreased demand from western Eurozone countries, making conditions less than favourable for UK exporters. Opportunities outside the Euro remain robust, with trading agreements this year confirmed with countries such as China and New Zealand.
2. The Olympics
The Olympics will significantly impact the UK in 2012. However, SMEs need to ensure they have planned processes in place in order to manage the challenges that this huge scale event will inevitably present. Increased congestion coupled with road and delivery time restrictions could cause unnecessary delays for businesses struggling to get their products to market. Ensuring you use a carrier with experience in planning and managing the logistics around such events may ease some of the burden.
3. Interest rates
Interest rates look set to remain low over the next 12 months, having stayed at 0.5 per cent since 2009. Low interest rates can present a real challenge to businesses, with consumers in the domestic market tightening their purse strings. However, countries where inflation isn’t hindering consumer spending such as India, could present a real opportunity. Looking for ways to grow your business in territories with similar conditions could help you secure market share.
4. Business continuity
A planned approach to your business strategy over the next 12 months will ultimately see you through a number of the challenges highlighted. However, not all of the disruptions from this year can be anticipated. Everything from social disruption to adverse weather can disrupt your route to market, so having a robust business continuity plan in place is the best way to navigate challenges.
Small business initiatives to help funding and ease credit will come into force next year presenting great opportunities for SMEs to boost their outputs. Cameron’s ?95m funding programme for SMEs and the extended rate relief announced in 2011 will provide businesses with a fiscal boost to grow their businesses. Specifically, the Prime Minister highlighted this funding as an impetus for UK businesses to seek greater opportunities abroad and drive economic growth.
With 11m spectators expected to visit London next summer, it’s predicted that the UK will benefit from an influx of ?750m consumer spending. Businesses should look to capitalise on this new global audience with their products and services engaging in campaigns to negotiate sales potential and capture future international customers.
3. Emerging markets
Where China goes; the rest of the world follows. China is an extremely influential player in the global marketplace. Data released relating to China’s latest export figures have indicated that due to difficult trading conditions in Western Europe, the country will be focusing its efforts on other emerging markets. Following their lead could present great growth opportunities for UK SMEs in 2012.
Consumers are increasingly using mobile internet to shop online. In fact, recent research indicates the number of consumers accessing the web via mobile in Australia for example, has grown significantly of late with a strong trend towards m-commerce. PayPal has found that with the advent of mobile payments, nearly 68 per cent of Australians are planning to use mobile devices for transactions and payments. SMEs should be sure to capitalise on this growing trend and in particular, make sure their sites are mobile ready for markets demanding to make sales through this channel.
Neil Kuschel is sales director of DHL Express.