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Obstacles to export growth for small and medium sized Agrifood companies - FO0110

This project consists of two parts:

Part One: aims to increase understanding of exporting trends amongst small and medium sized enterprises (SMEs) in the agrifood sector. It will explore in particular why some companies export and others do not, what the barriers to growing the agrifood export market are and how best to target intervention and so promote growth in this area.

Specifically the research will:
i. Provide a more granular understanding on who is exporting (i.e. products type, company size, and location), as trade statistics only gives export figures by volume and value in broad product grouping.
ii. Give a business perspective on why and how agrifood businesses start exporting and how they develop their export business, and what the obstacles to export growth are (both for new and existing exporters).

The main elements of the research will be:
• A rapid literature review looking at the trends/data on SME agrifood export, including whether there is evidence to suggest that food and drink SME export success is broadly in line with other sectors of the UK; and
• Primary research with businesses in the form of an online or telephone survey of 500 agri-food businesses to gather data from agrifood SMEs relating to their views on the export market and what the obstacles to export growth are.

This research will help policy makers (Defra, other government departments (OGDs), trade associations and levy bodies) to develop a clearer picture of the UK’s current export capacity in relation to agrifood SMEs, and potentially identify strengths and opportunities for future export growth. A consideration of the obstacles to export growth will help to identify the key barriers that prevent new and existing exporters from growing their international businesses, and how best to target interventions to maximise impact in terms of growth in exports.
It will directly contribute to Defra’s Export Action Plan (December 2011), a key output from Defra’s Business Plan commitment to take full advantage of the potential for growth through overseas trade.

Part Two aims to better understand what export information and sources are available to agrifood SMEs and to what extent these are accessed. These findings will assist in the development of a number of options for better disseminating exporting information and support to agrifood SMEs, and also gather views towards these.

Specifically the research will:

i. Provide a comprehensive picture of current export information and support available to agrifood SMEs, the format of these, by whom they are provided and how effective they are in developing a business’ export trade.
ii. Give perspectives and insights into industry behaviours on what/how information sources are accessed, how they are accessed and why some are accessed and others are not.
iii. Develop a number of options for better disseminating export information to agrifood SMEs.

The main elements of the research will be:

• Rapid evidence gathering and assessment to identify what export information and support is already available to businesses within England, in what format these are available, and who provides the information and support. Utilising existing research this element will also explore stakeholder behaviours to gain insights into what mechanisms work/don’t work with regard to accessing support and advice around exporting and the impact this has on a business’ growth. The assessment will draw on both national and international sources and across all business sectors.

• Interpret the evidence collated to inform the development of options around how existing information sources might be developed or improved, or to understand how good practice identified elsewhere could be used to develop options for enhanced export information access by agrifood SMEs within England. The development of these options will be based on the findings from the research. However, the options might cover three possible scenarios, ranging from adapting existing information sources through to a full new information source tool.

• Primary research with 500 agrifood SMEs that currently export or are considering exporting in the future in the form of a telephone survey, with supplementary in-depth workshops with businesses and trade representatives. These will identify what businesses actually do and why in relation to accessing information and support around exporting. The primary research will promote understanding of business behaviours and will provide insights into what available support and information businesses are aware of, what they actually access and how, as well as exploring views and ideas towards options for communication tools to better disseminate agrifood exporting information.

This research will help inform discussions between policy makers (Defra, other government departments (OGDs)) and industry (such as the Food and Drink Federation) on the development of the most appropriate dissemination tool. This project will directly contribute to Defra’s Export Action Plan (January 2012), a key output from Defra’s Business Plan commitment to take full advantage of the potential for growth through overseas trade.

Part One Objectives:

To identify exporting trends amongst SME agrifood businesses
Specifically this will set out to:
i. Profile businesses that do export including: size, turnover, location, company type (marketing companies vs food manufacturers)
ii. Identify what they are exporting and how much
iii. Identify the location of export markets
iv. Identify export markets companies would like to export to in the next 5/10 years?

To identify how agrifood SMEs access international markets
Specifically this will set out to:
i. Identify routes to market (e.g. direct selling or via agents and distributors, licensing, joint ventures, establishing a site overseas, use of export agents etc.)
ii. Identify who and how agrifood SMEs get advice and information around exporting from

To explore reasons for exporting and identification of any benefits
Specifically this will include:
i. Exploration around improvements in company resilience as a result of exporting (e.g. through by diversified markets)
ii. Exploration of the relationship between innovation and exporting, and exporting and innovation

To identify actual and perceived barriers to export growth both amongst companies that do export and those that don’t (including cultural barriers, legal, regulatory and procedural barriers, technological/logistical barriers)

To explore potential incentives that might promote growth

Part Two Objectives:

Based on the information provided in the brief the detailed objectives of the study will be:

A. Assessment of the current status of export information availability and utilisation by SMEs in the agrifood sector.

i. Identifying what export information is already available.
ii. Identifying which information is being successfully accessed by agrifood SMEs and reasons for access.
iii. Identifying reasons/barriers to accessing information that is not being successfully accessed.
iv. Identifying where are there export information gaps, and what information is needed but is not available.

B. Consideration of the mechanisms, tools and systems available for accessing export information:

i. Identifying the methods available for accessing export information, i.e. what are the existing information sources. This will not be restricted to internet based methods, although it is anticipated that the majority of information is currently disseminated in this format. This may include export advisers, mail pamphlets, and export road shows.
ii. Identification of the available methods available to other sectors, and also in other countries, particularly those areas where there is evidence of effective and efficient information access and where this has had a positive impact on business development.
iii. Exploration of how the existing information sources might be developed or improved to plug any information gap.
iv. Exploration of how best practice identified above might be used to develop options for enhanced export information access by agrifood SMEs.
v. dentification of the risks/benefits of the different options.

C. A consideration of who might be best placed to plug this information gap:

i. Identification of where information is being effectively and efficiently accessed by businesses, who were the providers, how was the information provided.
ii. Understanding of where and who exporters would go to identify their export information needs and why.

Project Documents
• EVID4 - Final project report : EVID4 Final Report - 2   (324k)
• EVID4 - Final project report : Final Report - Part One   (537k)
• FRP - Final Report : Export Growth Final Report 2   (1395k)
• FRP - Final Report : Obstacles to Export Growth Final Report 1   (1198k)
• ANX - Annex : Exports Growth Technical Annex 2   (1151k)
• ANX - Annex : Obstacles to Export Growth Technical Annex 1   (1611k)
Time-Scale and Cost
From: 2011

To: 2012

Cost: £70,821
Contractor / Funded Organisations
University of Plymouth
Resource efficient and resilient food chain              
Sustainable Farming and Food Science              
Fields of Study
Resource Efficient and Resilient Food Chain