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Looking overseas through Brexit tinted glasses

The idea that UK resellers want to expand internationally caught the interest of Billy MacInnes who found that Brexit was having an impact on those dreams

Since when did UK channel partners become so enthusiastic about expanding abroad? It’s a question I found myself asking after reading the findings of recent research from Agilitas IT Solutions which reported that 52% (now there’s a familiar figure!) of UK channel businesses were actively looking to expand their business internationally .

And by internationally, they meant Europe, the Middle East, Africa and North America. The survey also found that nearly two-thirds of respondents were already operating in the APAC region and 32% were considering moving into countries in South America.

So there we have it, Boris Johnson’s much-maligned “Global Britain” in operation. Except for the fact a fifth of all companies believed Brexit would “significantly delay growth plans”. So, not quite global, more like “outside the EU”.

And there’s a possibility that this “optimism for expanding internationally” as Shaun Lynn, Agilitas CEO describes it, could be more a consequence of Brexit and its potentially painful impact on UK companies, their home market and their potential plans to expand into Europe.

It was interesting, for example, to find that the main motivations for global expansion, identified by more than 30% of respondents in each instance, were potential new customers in new markets, existing customers looking to enter into new markets and being financially more secure.

Might those three be a consequence of Brexit too? Expansion is a welcome development but it’s also true that the impetus for moving into new territories can often be to make up for low growth, stagnation or decline in existing markets. In this case, the UK. And not just for channel businesses but for their customers as well.

Withdrawal from the EU also brings with it a requirement to compensate for the loss of prospective European customers by looking elsewhere, usually further afield.

This more or less mirrors the arguments put forward by those arch-Brexiters who claim leaving the EU will make it easier to trade with more countries globally. What they neglect to mention is that if there is a hard Brexit or no deal, UK companies won’t have much of a choice in the matter.

The big question is: how much of this “optimism” for international expansion is motivated by genuine enthusiasm and how much is driven by anxiety or desperation over the future direction of the UK economy post-Brexit? Everyone will have their own views but when the best the prime minister has to say about a no deal Brexit is that “it’s not the end of the world” and the leader of the opposition refuses to give a straight yes or no answer to whether the UK will be better off after Brexit, enthusiasm might not be the dominant emotion for many businesses.

This was last published in September 2018

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