The 2007 survey of international services provided to UK companies, commissioned by The Institute of Export and carried out by Novus Initium, has been completed and makes interesting reading. Companies are increasingly concerned but their banks have a better reception this year.

The results of a 2007 survey of international services provided to UK companies provides a good insight into how trading companies view their bankers, which banks they rate the best for providing international services and products, the strongest and weakest factors in bank relationships and areas in which they would like banks to improve.

The UK’s Institute of Export commissioned the 2007 survey and it builds on research that both the institute and trade advisory house Novus Initium have conducted over the last 12 years. “This research is the most comprehensive work into the way in which international trading companies in the UK are operating,” says Mark Runiewicz of Novus Initium.

The full report detailing the banks that have the highest rating and best comments, together with league tables, are available through subscription.

The headlines of this year’s survey include:

1) UK companies continue to be very concerned with their competitiveness and profitability as they are faced with a strong supply of goods from China and India. The strength of sterling is helping importers to achieve larger profits. Exporters continued to struggle with the value of sterling, however, many trading with Europe in euros, which is facing less volatility.

2) Respondents are less critical of banks this year with the majority of banks meeting their customers’s financing needs. However, respondents were critical of the charges banks levy, speed of service and the access to knowledgeable bank staff. On a positive note, respondents valued good relations with their bank manager.

3) The full survey analyses banks’s service levels, by turnover band, exporter, import, and their needs. Additionally, the report segments the respondents by geographical region and creates a league table for various banks within each region.

4) Less than 50% of respondents receive any information on government initiatives and a similar number fail to receive any support or advice from UK Trade & Indemnity (UKTI).

5) More exporters are showing business growth than in 2006.

6) Companies are critical of the increase in red tape and also lack of government support. Many are unable to name any minister championing exporters.

7) The full survey details the strengths, weaknesses, and reasons that will cause companies to move banks. This research will provide banks with key pointers in which they can protect their business or gain market share from their competitors.

Novus Initium telephoned over 8,000 companies to examine their trading patterns, banking relations and government support. Over 1,500 responded to the telephone survey making this the largest survey of international traders in the UK.


Some 52% of companies surveyed reported that exports were growing with 35% of respondents stating that turnover remained static. A much higher percentage of companies with turnovers above £1mn reported higher levels of export growth. This is a significant improvement from 2006.

Many respondents report sales growth areas across all geographical regions, with many of the larger companies trading in many different markets and with a spread of business from direct sales, joint ventures and subsidiaries.

Companies have more confidence in their business in 2007 when compared to 2006, although competition is strong from overseas competitors.

Export performance of companies in 2007

Export turnover Increase Static Contracting
Up to £1mn 50% 41% 9%
£1 – £5mn 93% 0% 7%
£6 – £10mn 84% 13% 3%
£11 – £25mn 78% 20% 2%
£26mn plus 65% 20% 15%

There was an increase of 12% in the number of companies reporting an increase in export turnover in 2007 compared to 2006. Companies in the £5mn turnover band grew by 49%, the £6mn-£10mn band grew by 25%, the £11mn-£25mn band fell by 8% and companies with a turnover above £26mn reported a drop in export sales of 10%.

Some 8% of respondents were closing their business or transferring their operations to locations outside of the UK. Novus calculated that nearly 2,000 jobs have been lost. Half of these companies were foreign-owned and the owners have withdrawn from the UK market.

Many respondents have been faced with competition from China and India. Many exporters have been unable to remain competitive, producing high volume and low cost items. However, on a positive note more companies are selling capital goods into these markets.

Exporters have reported increased business demand from Egypt, China and India, however the payment terms have been very competitive and extended credit terms were sought.

Brazil has been identified as a low cost market and exporters are actively seeking western technology to improve production quality.

Banking needs

Recent surveys of companies by various organisations have been critical of banks. Although the respondents have not enthused about services they have received from their banks they seem less critical compared to previous surveys.

Some 86% of respondents rated the service they received from banks as average or better, an increase from 66% last year.

However the smaller companies still appeared critical with over 50% claiming the service they received was poor. The survey also identifies the regional strength of the main banks.

More of the smaller banks are mentioned as providing good service levels.

An in-depth analysis of the banks is detailed in the main survey report. The report looks to identify the strengths and weakness of banks’s service levels. The strengths that many of the major firms stated were a relationship with the bank manager.

The major weakness noted was a lack of access ability to knowledgeable staff and charges. Low response times were mentioned by many respondents.The key areas that respondents for the banks to improve upon were: foreign exchange, letters of credit, faster transmission of payments overseas and more trade finance.

Once again, SMEs criticised the knowledge of bank staff when discussing international trade matters.

Around 45% of exporters do not receive any advice or information from UKTI. The smaller companies receive less, with nearly 40% of respondents with turnovers below £10mn receiving no communication from UKTI.

The majority of respondents felt the level of advice and information they receive from UKTI is poor, fragmented and of limited use.

The survey evidences that many companies fail to consider the investment, both in planning and cost when developing, maintaining and growing overseas markets. Further research has studied exporters’s attitudes and propensity for change.

The survey has highlighted major areas for complaints and frustration among medium and small exporters, who have little ‘pull’s in demanding change. Most banks are providing a basic international service, ie, payments and remittances. These exporters deal mostly with High Street branches, which now provide little more than a counter service. These companies need to be more proactive and request more support from their bankers.

This support is available but many domestic branch managers do not understand the request or do not know where to find the relevant information.

The survey also flags up the conflict and differences between bankers and exporters. Few bankers have exported goods and many exporters have seldom considered the implications of a deal going badly wrong.

Most smaller exporters, by their nature, are entrepreneurial and do not believe that transactions will go wrong and have the potential to wipe out their business. Exporters voice their frustrations at banks and government and many blame the buyers for intransigence and slowness to act; but many exporters fail to take ownership for the huge percentage of letters of credit that are rejected on first presentation to banks and the costs associated with the discrepancies.

Many branches have advised that much of this delay, cost and frustration could have been avoided if the exporter had shown more care and diligence.

The survey highlights many of the key areas that banks and government can address to improve the delivery and quality of service. The findings also show how exporters can help themselves and improve the service they receive from their service providers.

The full survey report is available from Novus Initium. Email