Growth in overseas turnover is being driven by UK mid-sized businesses according to new research from accountants and business advisers, BDO LLP.
The research reveals that mid-sized businesses (what BDO refers to as the economic engine) have grown international turnover by 63% in the last five years from £96bn to £157bn. This growth exceeds both FTSE 350 companies and smaller businesses (<£10m) which have both witnessed a decline in overseas revenues.
Over the last five years FTSE 350 and smaller firms experienced declines of 15% and 37% respectively, with FTSE companies generating £521bn of turnover outside of the UK and smaller businesses generating £8.5bn.
Domestic turnover growth tells a similar positive story for the UK’s mid-sized businesses, who have increased overall turnover by 44% over the same five year period, from £920bn to £1.3tn. For FTSE and smaller firms, the growth has been considerably smaller, with FTSE firms experiencing an 8% increase over five years and smaller firms recording a decrease of 14% in revenues.
Mid-sized businesses in London have experienced the highest international turnover growth over the last five years, recording an increase of 80% from £28bn to £50bn. London is closely followed by the South West and the West Midlands who recorded overseas turnover growth of 69% and 66% respectively.
The financial services sector (FS) has led the way for overseas growth over the last five years, witnessing an increase in overseas revenue of 117% from £7bn to £15bn. This compares with domestic turnover growth in the sector of 8% in the same period – considerably lower than many other sectors.
Since 2016, as part of its New Economy campaign, BDO has been calling on the government to place overlooked and undervalued mid-sized businesses at the heart of its policy making. The latest New Economy report sets out five policy areas that focus on ensuring the continued success of UK businesses post-Brexit.
Paul Eagland, Managing Partner of BDO, said:
“It is great to see the UK’s economic engine excelling both in terms of overseas and domestic growth. These are bold businesses with entrepreneurial instincts who are succeeding despite the current uncertainty.
“We want to see this growth continue which is why we are calling upon the Government to do more to help this overlooked and undervalued segment of the UK economy. Simplifying tax, investing in infrastructure and prioritising skills are all policy areas that the Government should be focusing upon”.
BDO’s New Economy report can be downloaded here.
Summary of key findings
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Overseas Turnover (latest year minus 5)
|Overseas Turnover % growth
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Our clients are Britain’s economic engine – ambitious, entrepreneurially-spirited and high-growth businesses that fuel the economy.
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