FedEx study shows most European SMEs involved in BRIC business

Almost 90 per cent of European SMEs are already doing business with emerging markets, and more than half expect to increase their involvement in 2011 and 2012, a study commissioned by FedEx Express and Economist Intelligence Unit has found.

Over half (55 per cent) of the SMEs surveyed believe Brazil, Russia, India and China will be crucial to their business in the coming year, with nearly half (48 per cent) of the SMEs singling out Brazil for improved perceptions of the country, bolstered by a smooth transition of political power and better infrastructure in the run-up to major sporting events.

FedEx Express, the world’s largest express transportation company, and business intelligence leader Economist Intelligence Unit sponsored the survey entitled ‘New horizons: Europe’s small and medium-sized companies look to emerging markets for growth. The views of more than 600 European SME executives were sought between March and April.

The study reveals how small and medium-sized enterprises are looking to emerging markets for rapid revenue growth as economic recovery in Europe remains slow. With many SME executives noting the “over-subscribed” and congested nature of the European marketplace, emerging markets have been fertile ground for SMEs seeking above-average returns.

All respondents hailed from Western Europe, primarily the UK, Italy, Spain, France, and Germany. All firms polled were already engaged in commerce beyond their national borders. The respondents were senior: 68 per cent were MDs, CEOs or another C-level position. Many are well established, for 10 years or more, only a minority are new businesses. All major industry sectors were represented.

To complement the survey findings, the Economist Intelligence Unit also conducted wide-ranging desk research and in-depth interviews with more than 20 small business owners, and other experts.

“Globalisation, e-commerce and free trade has opened up new markets to SMEs across the EMEA region. As a pioneer of reliable and flexible global transportation solutions, we are able to give our customers a meaningful edge as they enter uncharted territory and sell to new consumers. We understand that different businesses have different needs, so we have a suite of services that can meet the speed and cost needs of SMEs on a global scale,” David Binks, senior vice president, Operations, Europe, said.

FedEx has always been an early player in emerging markets, with over 20 years of market presence in countries like China, India and Brazil. FedEx investments have cultivated greater economic sustainability, growth, enablement and access to a global marketplace for people and businesses in these countries.

“Emerging markets are seen as crucial to the growth strategy of many European SMEs,” says Jason Sumner, senior editor at the EIU and editor of the report. “And SME executives believe they have some advantages when compared with larger rivals - they can respond more quickly to changing conditions, have closer relationships with customers and can better target niche markets.”

The report is available for free at www.businessresearch.eiu.com/new-horizons.html.