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Almost Half of Asia Pacific SMEs Predict Growth in Intra-Regional Exports

E-Commerce is Fueling Optimism among Small Businesses in the Region, According to FedEx Research

December 6, 2016

 

HONG KONG, December 6, 2016 — FedEx Express, a subsidiary of FedEx Corp. (NYSE: FDX) and the world’s largest express transportation company, has unveiled the results of a new global research study, which offers valuable insights into the import and export behavior of small businesses in Asia Pacific and around the world.

The survey reveals  that small- and medium-size enterprises (SMEs) in Asia Pacific that export goods are capitalizing on the growth potential of other markets in the region. While they already derive an average of more than two-thirds (68%) of their revenue from exports in general, the study reveals the growth potential SMEs see in other markets within the region: 47% of them predict that their revenue from intra-regional exports will grow in the next 12 months, with the average level of growth predicted to be a very healthy 20%.

“This highly incisive research reveals that, despite challenging global economic conditions, Asia Pacific SMEs are sustaining their businesses by tapping into other Asian markets for growth opportunities,” said Karen Reddington, president, FedEx Express Asia Pacific. “What emerges is a broadly optimistic picture, with SME exporters in the region planning to embrace technology and the digital economy to help overcome a wide range of business challenges, from higher production costs to increasing competition.”

The study also reveals a sense of optimism among the SMEs that is largely fueled by e-commerce potential. 80% of the region’s SME exporters already leverage e-commerce to sell to other markets, and 44% of them foresee growth in e-commerce revenue in the next 12 months.

In line with the boom in e-commerce, momentum is building behind two forms of e-commerce in particular, namely m-commerce (purchases made using mobile devices) and social commerce (purchases made via social media platforms). Some 68% of small businesses in the region are currently selling their products via mobile applications and 67% offer customers the option of making purchases via social media platforms like Facebook. M-commerce and social commerce account for an average of 21 and 22% of regional SMEs’ export-driven revenue respectively, and they believe that both will continue to drive growth: almost half of all SMEs expect their m-commerce- (47%) and social commerce-driven (49%) revenues to increase over the next 12 months.

Competing in the digital economy, however, presents new challenges. Almost four out of ten (38%) of Asia Pacific SMEs cited increasing international competition as a top business challenge. To navigate this new competitive landscape, small businesses also see technology as the means to cope: 37% of them say they plan to invest in new technology to overcome their current business challenges, and almost two-thirds (65%) believe that doing so will also help them to export more in the future.

SMEs also see the value of an efficient supply chain, which is vital to meet customer expectations, helping SMEs to win customers and improve bottom lines[1]. Some 91% of Asia-Pacific SMEs agree logistics plays an important part in their export business. E-commerce, in particular, is driving demand for faster delivery, with a significant 66% of APAC SMEs engaged in e-commerce indicating that they are willing to pay a premium for faster delivery services.

“This research study confirms our long-held view that, for SMEs, technology and supply chain solutions dramatically level the playing field in competing with larger players,” added Reddington. “Increasingly, SMEs are investing in technology and looking to their logistics providers to help them adapt to their customers’ evolving needs, penetrate new cross-border markets and ultimately ensure their businesses remain competitive and sustainable.”

The independent study, entitled “Global Trade in the Digital Economy: Opportunities for Small Businesses”, was conducted by Harris Interactive on behalf of FedEx to provide insights into global export opportunities and challenges facing SMEs. Completed in September 2016, the results are based on interviews with a total of 9,000 senior executives of SMEs from 17 markets[2] across four regions[3].

 

About the Research Study

Harris Interactive carried out 9,000 interviews with senior executives in SMEs online and by telephone in 17 markets[4] spanning four global regions[5] between August and September 2016.  Interviews were split equally by country with a representative mix of company sizes: micro (1-9 full-time employees), small (10-49 full-time employees) and medium (50-249 full-time employees).  Different definitions were used in Brazil, Colombia and India, in line with country-specific definitions for company sizes.  The sample size was approximately 500 respondents per market, with the exception of the UK, where the sample size was 1,000 respondents.

 

About FedEx Express

FedEx Express is the world’s largest express transportation company, providing fast and reliable delivery to more than 220 countries and territories.  FedEx Express uses a global air-and-ground network to speed delivery of time-sensitive shipments, by a definite time and date supported by a money-back guarantee[6].

 

About FedEx Corp.

FedEx Corp. (NYSE: FDX) provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services.  With annual revenues of $58 billion, the company offers integrated business applications through operating companies competing collectively and managed collaboratively, under the respected FedEx brand.  Consistently ranked among the world’s most admired and trusted employers, FedEx inspires its more than 400,000 team members to remain “absolutely, positively” focused on safety, the highest ethical and professional standards and the needs of their customers and communities.  To learn more about how FedEx connects people and possibilities around the world, please visit about.fedex.com.

 

NOTE TO EDITORS:  FedEx Express press releases are available on the World Wide Web at news.fedex.com.

[1] “Global Trade in the Digital Economy: Opportunities for Small Businesses” a commissioned research study conducted by Harris Interactive on behalf of FedEx, September 2016

[2] Belgium, Brazil, China, Colombia, France, Germany, Hong Kong, India, Italy, Japan, Netherlands, Poland, Singapore, South Korea, Spain, Taiwan and the UK

[3] Asia Pacific; Europe; Latin America & the Caribbean; Middle East, India & South Africa

[4] Belgium, Brazil, China, Colombia, France, Germany, Hong Kong, India, Italy, Japan, Netherlands, Poland, Singapore, South Korea, Spain, Taiwan and the UK

[5] Asia Pacific; Europe; Latin America & Caribbean; Middle East, India and South Africa

[6] Subject to relevant terms and conditions.

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