SMEs contribute significantly to international trade. According to Eurostat (Federal Statistical Office of the European Union), in countries like Cyprus and Estonia, SMEs accounted for over 80% of the trade value in intra-EU exports.
Conversely, in major economies such as France and Germany, the share was significantly lower, with SMEs contributing around 33-35% of the trade value.
To boost their participation in global markets, they need access to finance, technological adoption, and favourable trade policies. With the white-paper ‘Global Expansion Simplified: The Ultimate Guide for SMEs’, DHL Express and the renowned University of Maastricht have developed a practical guide for SMEs to meet the challenges of expanding internationally.
“One of the primary benefits of internationalisation for SMEs is the access it provides to new markets. By expanding beyond domestic borders, SMEs can tap into larger customer bases and diversify revenue streams. This also pushes businesses to improve and excel in order to compete in a broader market,” said Michiel Greeven, EVP Global Commercial at DHL Express.
“With our whitepaper, we offer SMEs a practical, easy-to-use toolkit to prepare for global expansion, making their businesses more profitable and resilient.”
“With our contribution to this whitepaper, we aim to support SMEs in realising their international ambitions. Starting with a solid strategy, expanding globally can offer great opportunities for SMEs seeking to explore new markets.
“We hope the insights provided in this whitepaper will enrich their knowledge base and bring them one step closer to successful international growth,” added Roy Broersma, Managing Director Centre for Entrepreneurship & Innovation at Maastricht University.
Key Takeaways:
- Understanding the Importance of Internationalisation: SMEs benefit from considering internationalisation as an essential component of their business strategy, sustaining operations while driving growth and innovation in the global marketplace.
- Conducting Thorough Market Research: To effectively implement an international strategy, SMEs need insight into upcoming challenges, opportunities, and customer behaviour. Market research provides a foundation of understanding on consumer behaviour, market trends, economic conditions, and cultural nuances.
- Leveraging Human Resources: Human resources play a pivotal role in internationalisation. By aligning human capital with strategy, investing in training, recruiting the right talent, developing flexible HR practices, and fostering a culture of continuous learning, SMEs can enhance their chances of success in global markets.
- Developing Cultural Intelligence: Cultural intelligence (CQ) is crucial for interpreting market data accurately and developing culturally sensitive strategies, by understanding and appreciating local customs, values, consumer behaviour, and business etiquette.
- Forming Strategic Partnerships and Networks: A key first step in internationalising a business is to extend networks by forming relationships with stakeholders, such as customers, suppliers, and distributors in foreign markets.
- Choosing the Right Entry Mode: Selecting the appropriate entry mode is critical for managing risks and leveraging local advantages.
- Navigating International Laws and Regulations: Legal and regulatory hurdles across multiple markets can impede internationalisation efforts. Understanding how to navigate them and mitigate risks is essential to growing internationally.
- Optimising Supply Chain Management: An efficient supply chain is key to success in global markets. SMEs may develop their own or partner with third-party logistics providers to achieve maximum efficiency, flexibility, and scalability.
- Monitoring and Experimenting: When considering international expansion, a strategic approach that includes experimentation and monitoring of key performance indicators (KPIs) significantly enhances success.
The nine building blocks offer an accessible framework for any SME venturing into international trade, highlighting potential challenges and priority focus areas that help reduce costs and risks while maximising growth opportunities.
The white-paper ‘Global Expansion Simplified: The Ultimate Guide for SMEs‘ can be downloaded on the DHL website.
