The UK’s small and medium sized companies have had a difficult couple of years. A perfect storm of Brexit complications – and a pandemic upturning global (and local) supply chains – have made planning near impossible and forced businesses to find new ways of working to meet customer demands.
With this in mind, how are these businesses faring? And can the ambitious mindset of the UK’s businesses survive? It seems for many, the answer is yes.
According to Santander’s Trade Barometer Autumn 2021 report, business confidence has increased, with 73 per cent of companies confident of growth over the next three years (it was 65 per cent in spring 2021). Within that, international businesses continue to show higher levels of both business confidence and performance.
Internationally trading businesses are undeterred by Covid-19’s potential impact on global trade, with 71 per cent continuing to operate in their chosen markets. And more than a fifth of businesses (21 per cent) believe international markets have become more important as a result of Covid-19 – with North America most attractive.
Of course, as we’ve seen, it isn’t easy. We’re operating in a fast-changing environment. According to the Trade Barometer, the key challenges are bureaucracy, post-Brexit regulation, logistics and skill shortages, and the difficulty of finding trustworthy partners in overseas markets.
The desire to go global is still present among those who don’t currently trade abroad. Santander’s research found the proportion of current domestic-only businesses considering international expansion in the next three years is 15 per cent.
As the fourth largest bank in Europe, covering 85 per cent of the UK’s trade and investment flows, Santander is keen to help any business looking to grow internationally, whether it has been doing it for years or is just getting started.
Here, three ambitious businesses meet with trade experts to discuss how growth can come from more than the promise of great profit. They show that it pays to have a company purpose – a mission, whatever that may be.
Despite challenging conditions, businesses across the country have continued to go for growth – and many are looking to expand their operations overseas, says Gabriella Griffith
How to start trading abroad
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MISSION VERY POSSIBLE
‘Ambition, with managed risk, is what is needed’
Power to the people
For some traders, profit isn’t the only principle. Leaders at organic and plant-based food supplier Clearspring talk about building the business
and spreading their environmental message
"It is financial freedom that is enabling us to grow without cashflow problems"
"Companies of all sizes need to challenge themselves anew when looking for places to grow"
When Answer Digital was founded, Gary Parlett had an ambition to create something a bit different. For a start-up IT consultancy at the height of the dotcom era, this meant sharing knowledge with clients rather than protecting it like some kind of dark art. It also required investment in talent beyond just technical training.
“We set out to become internet technology leaders but also expert collaborators who were giving of their knowledge,” he says. “We started life as the Ultimate People Company, which is an audacious name but it tells you what’s at the heart of the business.”
This kind of talk from business leaders and entrepreneurs is nothing new. But last year, mid-pandemic, Leeds-based Answer Digital proved just how important its people are to the company: it became an employee ownership trust. “We had some flattering approaches from private equity and trade buyers, which made us think about the future of the business,” says Parlett. “It became clear that the right answer was to back the people who have grown with us for 20 years rather than hand it over to someone else.”
This move transformed not only the leadership structure of the business, but its ambition – it leapt from typically 10 to 15 per cent annual revenue growth to more than 50 per cent this year.
Becoming employee-owned has clearly motivated Answer Digital, but it’s not something you see every day, says Sean Longsdale, managing director of the structured finance group at Santander UK corporate and commercial banking: “It’s great for customers to see and helps retain highly skilled people.” Creating an environment where everyone is ambitious for the company’s success is something most leaders strive for. Parlett found it through employee ownership. But this kind of investment and dedication is also baked into the DNA of family-owned businesses.
“Being a family business is a defining part of our culture,” says Paul Schaffer, MD of Plum Play. His parents started the outdoor play equipment company 33 years ago. “People are so important to us and we want to stay true to our values.”
When Schaffer took over in 2019, it became deeply personal. “I was able to stand on the shoulders of the people before me and to grow further from there.”
The ambition at the heart of Plum Play’s operations is to have a piece of its equipment in the back garden of every childhood home. “Our products become part of the fabric of a garden. Children will look back and remember the good times they had.”
To this end, Schaffer has focused on international growth – and expects overseas sales to beat UK ones for the first time this year.
Headquartered in Lincoln, Plum Play has offices in Sydney and Hong Kong. The Australian office was a no-brainer for a seasonal business, and what started as a sourcing office in Hong Kong has become a trading hub as sales have taken off in the likes of Canada and the USA.
The panel
Maria Dawson-Lloyd
commercial director, Clearspring
Christopher Dawson
CEO, Clearspring
The panel
gary parlett
co-founder, ANSWER DIGITAL
Sean Longsdale
MD, structured finance
group, santander
of businesses are confident about growth compared with 65% in spring 2021
73%
of UK-only companies are now considering export trade
15%
of businesses believe international trade is more important, post-pandemic
21%
Products and services are subject to eligibility, status, terms and conditions and availability.
Illustrations by Gary Neill/Central Illustration Agency for Bridge Studio
When Christopher Dawson travelled to Japan in 1979, it opened his eyes to a dynamic, self-sufficient food culture. Having just gone vegetarian, and with an interest in organic farming, he was fascinated by the way Japanese cuisine used vegetables and plant-based foods to get maximum nutrition and flavour.
Dawson stayed in Japan for 18 years and developed a network of organic food producers there. When he returned to the UK, he created a sales and marketing network for Japanese foods and founded Clearspring in 1993.
The family-owned brand sells plant-based Japanese and organic fine foods. It has an HQ in London, a warehouse in the Netherlands, and exports to more than 60 countries. It’s a complex business with nearly 300 organic products stocked by independents and the likes of Ocado and Waitrose.
As a result, admin and issues such as currency fluctuations can detract from the big picture: the brand’s ambition to spread the word about organic farming and Japanese food culture. “We’re the biggest importer of Japanese organic foods globally and at any one time we have £5 million of goods either in transit or at the warehouse to serve our global customer base,” Dawson says.
Jenny Tasker, regional director and head of international clients for corporate and commercial banking at Santander, notes that with a hub in the Netherlands since the mid-Nineties, Clearspring had an advantage when Britain left the EU: “You were labelling in different languages and meeting origin of goods criteria way before Brexit – how have you fared with the transition?”
Maria Dawson-Lloyd, Dawson’s eldest daughter and commercial director of Clearspring, says: “Having a base in Holland and a distribution network in Europe made a big difference. We were very familiar with the import/export paperwork, commodity codes and certifications because we deal with those day in, day out. Plus, we export to the remaining 27 EU countries without coming up against any barriers.”
Setting up in the Netherlands and securing that warehouse before 2021 may have put Clearspring ahead of the game internationally, but it is not protected from the currency fluctuations that can
dog global traders.
“The biggest challenge for us is currency because the Japanese yen is always fluctuating and we like to try to have a price which is viable for us as a company, without constantly having to change it,” says Dawson. “This is where trade finance and loan facilities from Santander have supported us.”
The freedom to run your business and not worry about currency volatility is important, agrees Tasker. “Having some structure behind how you manage that risk must be a comfort so you can do what you’re skilled at – getting sustainable, organic produce into more stores and on to more tables.”
That mission was threatened by Covid-19 as the delicate balance between import and export lead times was thrown into disarray. A sudden spike in online orders made this challenge even bigger.
“Online sales rocketed to their highest level and we even debated shutting the site down because we didn’t know if we could fulfil the orders,” says Dawson-Lloyd.
“We realised we needed to help our customers so we just let everyone know the food would take a bit longer and we worked nights, weekends and everyone helped packing boxes in the HQ.”
Clearspring’s global turnover increased by 25 per cent in 2020 and operations continued thanks to the dedication of its staff. Sudden spikes in growth fuelled by a global health crisis are hard to plan for, but for a firm with big global ambitions, future growth must be sustainable.
“It’s about having a clear plan for the future and having the right systems in place as a foundation,” says Dawson-Lloyd. “We invested in enterprise resource planning systems in 2019, which came at the right time.”
The right banking partner has also helped, adds Dawson. “Santander enables us to buy the goods, sell them and get payment before having to pay money back. It’s financial freedom that is enabling us to grow without cashflow problems.”
Clearspring’s ambitions for the future are fuelled by its strong sense of purpose. When you’re trying to boost organic farming globally and support traditional Japanese food practices, there’s no time to waste.
“I come from New Zealand and grew up with maps on the wall so I have a huge appetite for new markets,” says Dawson. “We’re working with 60 countries, but we’re negotiating with a total of 72. We’re trying to reach as many countries as possible because we want to convert more acres to organic farming every day.”
Dawson says he wants Clearspring to be a £50 million company within six years – and the incentive isn’t only financial. “We support organic agriculture. Conventional farming leeches the soil of nutrients and jeopardises the future of food production.”
As more people switch to vegetarian and vegan diets and become conscious of sustainability, this mission is hitting home with consumers, says Dawson-Lloyd: “The emotional connection with the customer is a key driver. By choosing us, customers are not just helping us to grow, they’re contributing to a sustainable future – one that supports traditional and authentic food culture with integrity.”
UK businesses trading internationally have faced tangible challenges. They’re dealing with strong demand for British products but at the same time there are significant Brexit and Covid drag factors. Businesses need to continue to evolve their strategies to stay resilient and seize opportunities in the current trading environment.
Companies of all sizes need to challenge themselves anew when assessing where growth opportunities lie. Is there a market for my products? How do I access trading partners? Distributors? Local staff? Local premises? How do I navigate trading with international partners? Labelling rules? Origin of goods requirements? Logistics? There’s a lot to unravel before they consider looking to their bank for support.
Our recent Trade Barometer insight confirms this by telling us that access to finance is often the least of businesses’ worries. Sometimes providing more funding is a solution, but it is also vital we truly listen and understand the challenges and opportunities businesses face.
We help firms navigate some of these operational challenges first, and we’re looking at the common barriers to international growth and how we can help overcome them. This is why we’re committed to providing insight, sector and market expertise, and digital tools as well as a variety of financing solutions both in the UK and across our global network.
For example, we’ve helped businesses diversify their supply chains when regional lockdowns disrupted them, provided training for companies on post-Brexit paperwork and helped connect firms in a wide variety of sectors with new routes to international markets.
We love supporting UK businesses to realise their ambitions, internationally and domestically. We work closely with the Department for International Trade and UK Export Finance and we’re proud to be an initial banking partner for the General Export Facility, through which we have helped companies export for the first time.
We all need to evolve to thrive, and in some cases survive. Leaders appreciate that there will always be “unknown unknowns”. But if a business is really firm in its intentions – and it makes sure it has a considered plan, the right partners, and the risks well managed – it can navigate uncertainty and find that opportunity for growth. The mood out there as we look forward to 2022 is optimistic, especially among international businesses or those which aspire to be. Many companies are taking the first step towards their goals, and that’s where we can help.
PAUL ScHAFFER
mD, PLUM play
“Kids around the world want the same thing: they want to play,” says Schaffer. “The North American side of our business has experienced triple-digit growth since we started it.”
For both Plum Play and Answer Digital, supporting and investing in their workers is central to the business’s ambitions. Plum Play has a strong retention rate – many non-family members have been with the business for more than ten years. Meanwhile, Answer Digital has created an academy to bring the next generation of talent into the business.
“We’re approaching 100 people in the business now and 50 per cent have come from the academy,” says Parlett. “They’ve grown up with us and that gives us a real sense of purpose for the future.”
Longsdale agrees: “Between the academy and the employee ownership, Answer Digital is bringing people on the company’s journey, which is a game-changer for mindset and ambition.”
Combined with employee ownership, it’s a powerful driver, says Longsdale. “These people really are with the business every step of the way, and knowing that they are creating value for themselves, not just the company, will be transformational.”
A family affair
Plum Play is a family business whose philosophy has allowed it to retain many of its non-family staff for more than ten years
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The panel
When Christopher Dawson travelled to Japan in 1979, it opened his eyes to a dynamic, self-sufficient food culture. Having just gone vegetarian, and with an interest in organic farming, he was fascinated by the way Japanese cuisine used vegetables and plant-based foods to get maximum nutrition and flavour.
Dawson stayed in Japan for 18 years and developed a network of organic food producers there. When he returned to the UK, he created a sales and marketing network for Japanese foods and founded Clearspring in 1993.
The family-owned brand sells plant-based Japanese and organic fine foods. It has HQ in London, a warehouse in the Netherlands, and exports to more than 60 countries. It’s a complex business with nearly 300 organic products stocked by independents and the likes of Ocado and Waitrose.
As a result, admin and issues such as currency fluctuations can detract from the big picture: the brand’s ambition to spread the word about organic farming and Japanese food culture. “We’re the biggest importer of Japanese organic foods globally and at any one time we have £5 million of goods either in transit or at the warehouse to serve our global customer base,” Dawson says.
Jenny Tasker, regional director and head of international clients for corporate and commercial banking at Santander, notes that with a hub in the Netherlands since the mid-Nineties, Clearspring had an advantage when Britain left the EU: “You were labelling in different languages and meeting origin of goods criteria way before Brexit – how have you fared with the transition?”
Maria Dawson-Lloyd, Dawson’s eldest daughter and commercial director of Clearspring, says: “Having a base in Holland and a distribution network in Europe made a big difference. We were very familiar with the import/export paperwork, commodity codes and certifications because we deal with those day in, day out. Plus, we export to the remaining 27 EU countries without coming up against any barriers.”
Setting up in the Netherlands and securing that warehouse before 2021 may have put Clearspring ahead of the game internationally, but it is not protected from the currency fluctuations that can
dog global traders.
“The biggest challenge for us is currency because the Japanese yen is always fluctuating and we like to try to have a price which is viable for us as a company, without constantly having to change it,” says Dawson. “This is where trade finance and loan facilities from Santander have supported us.”
The freedom to run your business and not worry about currency volatility is important, agrees Tasker. “Having some structure behind how you manage that risk must be a comfort so you can do what you’re skilled at – getting sustainable, organic produce into more stores and on to more tables.”
That mission was threatened by Covid-19 as the delicate balance between import and export lead times was thrown into disarray. A sudden spike in online orders made this challenge even bigger.
“Online sales rocketed to their highest level and we even debated shutting the site down because we didn’t know if we could fulfil the orders,” says Dawson-Lloyd.
“We realised we needed to help our customers so we just let everyone know the food would take a bit longer and we worked nights, weekends and everyone helped packing boxes in the HQ.”
Clearspring’s global turnover increased by 25 per cent in 2020 and operations continued thanks to the dedication of its staff. Sudden spikes in growth fuelled by a global health crisis are hard to plan for, but for a firm with big global ambitions, future growth must be sustainable.
“It’s about having a clear plan for the future and having the right systems in place as a foundation,” says Dawson-Lloyd. “We invested in enterprise resource planning systems in 2019, which came at the right time.”
The right banking partner has also helped, adds Dawson. “Santander enables us to buy the goods, sell them and get payment before having to pay money back. It’s financial freedom that is enabling us to grow without cashflow problems.”
Clearspring’s ambitions for the future are fuelled by its strong sense of purpose. When you’re trying to boost organic farming globally and support traditional Japanese food practices, there’s
no time to waste.
“I come from New Zealand and grew up with maps on the wall so I have a huge appetite for new markets,” says Dawson. “We’re working with 60 countries, but we’re negotiating with a total of 72. We’re trying to reach as many countries as possible because we want to convert more acres to organic farming every day.”
Dawson says he wants Clearspring to be a £50 million company within six years – and the incentive isn’t only financial. “We support organic agriculture. Conventional farming leeches the soil of nutrients and jeopardises the future of food production.”
As more people switch to vegetarian and vegan diets and become conscious of sustainability, this mission is hitting home with consumers, says Dawson-Lloyd: “The emotional connection with the customer is a key driver. By choosing us, customers are not just helping us to grow, they’re contributing to a sustainable future – one that supports traditional and authentic food culture withs integrity.”
UK businesses trading internationally have faced tangible challenges. They’re dealing with strong demand for British products but at the same time there are significant Brexit and Covid drag factors. Businesses need to continue to evolve their strategies to stay resilient and seize opportunities in the current trading environment.
Companies of all sizes need to challenge themselves anew when assessing where growth opportunities lie. Is there a market for my products? How do I access trading partners? Distributors? Local staff? Local premises? How do I navigate trading with international partners? Labelling rules? Origin of goods requirements? Logistics? There’s a lot to unravel before they consider looking to their bank for support.
Our recent Trade Barometer insight confirms this by telling us that access to finance is often the least of businesses’ worries. Sometimes providing more funding is a solution, but it is also vital we truly listen and understand the challenges and opportunities businesses face.
We help firms navigate some of these operational challenges first, and we’re looking at the common barriers to international growth and how we can help overcome them. This is why we’re committed to providing insight, sector and market expertise, and digital tools as well as a variety of financing solutions both in the UK and across our global network.
For example, we’ve helped businesses diversify their supply chains when regional lockdowns disrupted them, provided training for companies on post-Brexit paperwork and helped connect firms in a wide variety of sectors with new routes to international markets.
We love supporting UK businesses to realise their ambitions, internationally and domestically. We work closely with the Department for International Trade and UK Export Finance and we’re proud to be an initial banking partner for the General Export Facility, through which we have helped companies export for the first time.
We all need to evolve to thrive, and in some cases survive. Leaders appreciate that there will always be “unknown unknowns”. But if a business is really firm in its intentions – and it makes sure it has a considered plan, the right partners, and the risks well managed – it can navigate uncertainty and find that opportunity for growth. The mood out there as we look forward to 2022 is optimistic, especially among international businesses or those which aspire to be. Many companies are taking the first step towards their goals, and that’s where we can help.
Illustrations by Gary Neill/Central Illustration Agency for Bridge Studio
Your next step. It starts here. We’re committed to building relationships with our clients so that we understand how to help them achieve their goals. Whatever your next step, we’re here to help you get started.
santandercb.co.uk
The panel
Santander’s regional director Jenny Tasker looks at barriers to international trade and how the bank can help overcome them
Building a business around their employees has worked wonders for these two companies – giving staff a stake, fresh ambition and a real sense of belonging
PROMOTED CONTENT
For some traders, profit isn’t the only principle. Leaders at organic and plant-based food supplier Clearspring talk about building the business and spreading their environmental message
Santander’s regional director Jenny Tasker looks at barriers to international trade and how the bank can help overcome them
Building a business around their employees has worked wonders for these two companies – giving staff a stake, fresh ambition and a real sense of belonging