Barriers must be overcome

What is Scotland as a trading nation so afraid of? You would think that any business would jump at the chance of increasing its potential customer base exponentially.

But take a quick look at the overseas trade data and you’ll find that’s not the case.

In fact, Scotland’s record on exporting is much weaker than it should be.

Data published at the start of this year showed that international exports, with the exception of oil and gas, generated £27.5 billion for the Scottish economy in 2014.

That is a robust number but it was down by 3.2% on a year earlier.

Unsurprisingly the food and drink sector, buoyed by the seemingly insatiable demand for luxury malts and fine Scottish salmon, was the best performing sector overall, generating sales of £4.8bn.

The second and third largest exporting sectors were, perhaps more surprisingly to the casual observer, professional services and the manufacture of refined petroleum products and chemicals.

The top five international export markets were the USA, Netherlands, France, Germany and Norway.

By far the largest cross-border trade partner is the UK, which accounts for almost two thirds of the total export value generated each year.

As our closest neighbours, that makes sense.

But what doesn’t make sense to me is the number of businesses that routinely spurn the opportunity to explore new markets.

I was reminded of this during a speech by SCDI chief executive Ross Martin at the BID Scotland 10th anniversary conference in Perth last week.

He told delegates that around 50% of Scotland’s total export effort was driven by just 50 companies. Think on that a second. That’s astonishingly low given there are in the region of 360,000 private enterprises in Scotland. So why so few? Complacency? Fear? Lack of knowledge? Lack of interest?

In January, the Scottish Government’s Export Statistics Scotland (formerly the Global Connections Survey) asked 1,664 businesses to provide export data.

Of those, 284 provided some form of commentary about their exporting activity, or lack thereof, with their answers.

The most common reply to the survey, a total of 79 respondents, was simply that the business did not export.

A further 77 said questions about exporting were not relevant.

That’s more than half of a relatively small group of Scottish businesses for whom it seems that overseas trade is simply not on their horizon. That is hugely concerning in itself. In a challenging economic environment, surely the business community should be widening its field of vision rather than remaining stoically to the patch it already serves.

By no means do I think that exporting is easy or something that will provide an instant return.

There are bureaucratic hoops to jump through, but the likes of Chambers of Commerce and others have people dedicated to greasing those wheels.

The political will to push exports is also there from what I can see.

So I can only conclude the unwillingness to reach out to new markets comes from the companies themselves.

Whatever that barrier may be – physiological, logistical, physical or cultural – it must be confronted and must be broken down.

Scotland cannot afford to skirt around the edges of the world.

You would think any business would jump at the chance of increasing its potential customer base exponentially – but that’s not the case

Food and drink lead the way in international export activities.