Yahoo Finance Economic worries hit UK export as firms report drop in overseas sales
Small and medium sized (SMEs) exporters have seen a "worrying decline" in export growth following five consecutive quarters of flat activity, new figures show.
Analysis from the British Chambers of Commerce (BCC) shows 28% of SME exporters reported falling overseas sales, compared to those reporting an increase (22%).
The survey of more than 2,200 firms also showed exporters face an increasing squeeze on their operating margins as 65% expect their prices to go up, but 39% expect their profitability to go down.
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SME manufacturers trading overseas are under particular pressure, according to the data, with only 32% expecting their profitability to increase in the next 12 months, and 42% predicting a decrease.
But exporters in the service sector were slightly more optimistic than manufacturers, with 37% anticipating a decline in profitability, while 35% expect an increase.
The BCC's quarterly Trade Confidence Outlook for Q3 2022 also found that 73% of manufacturing exporters expect to raise prices in the next year, close to record highs.
Almost nine out of 10 (89%) firms in the sector cited raw materials as their biggest cost pressure, with 80% citing utilities and 75% citing labour costs.
"Small and medium sized businesses are the ones who have been really facing the pain of the current difficult international trading conditions," William Bain, head of trade policy at the BCC, said.
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"They are much more exposed to the combination of supply chain disruption, soaring prices, and the impact of Brexit red tape and compliance costs, than larger companies."
Bain also urged the government to take "decisive action" to reduce some of the "removable" Brexit red tape costs for traders.
