UPS Study Shows Exports Bring Value to SMBs

The vast majority of the world's consumers are located beyond the borders of the US, and yet only 24 percent of the nation's small and medium-sized businesses currently are engaged in global commerce, according to new research released a few weeks ago by UPS.

The online survey, which polled 1,082 US small-and medium-sized businesses last August, was designed to measure current perceptions of global trade, identify export barriers and uncover potential strategies to overcome these barriers so SMBs can become more engaged in global trade. The results showed that:

SMBs that export are seeing positive returns. Nearly two-thirds (64 percent) of the exporters polled saw a financial return within two years. 34 percent saw a financial return in less than six months. Almost half (49 percent) of respondents said they expect to double their businesses' exports by 2015, and about two-thirds (66 percent) reported that up to 25 percent of their annual revenue comes directly from exporting.

US trade policies influence success. SMBs engaged in global business had the most success exporting to Canada, Mexico, the UK and Australia, countries with which the US either has free trade agreements or bilateral trade relations. In contrast, nearly two-thirds (62 percent) of SMB exporters reported they have not had success exporting to the BRIC countries (Brazil, Russia, India, China) in the past 10 years. There are no US free trade agreements with these nations.

"Global commerce flows along the path of least resistance, so it's incumbent upon government and business to work together to remove trade barriers and help businesses grow beyond our borders, resulting in economic growth in return," said Dan Brutto, president of UPS International.

Recently, legislators in Washington have supported trade reforms. For example, the US National Export Initiative aims to boost exports from $1.57 trillion in 2009 to $3.14 trillion by 2015 by eliminating trade barriers and increasing access to export financing, among other measures. A large bipartisan majority in Congress just approved three new free trade agreements with South Korea, Colombia and Panama, and President Obama signed the new accords on Oct. 21.

Survey results are available at

TAGS: Finance
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