International sales and global suppliers key to ensure post pandemic business recoveryMay 26, 2022 | London
- Mastercard’s Borderless Payments Report 2022 has revealed nearly four in ten (37%) SMEs in the UK worry they will never hit pre-pandemic revenue levels again, however digital growth and international sales opportunities offer a ray of hope.
- Half (49%) are now doing more business online and 22% are seeing more overseas sales.
- 32% also say the pandemic has allowed them to source suppliers more competitively across borders and almost half (46%) say they plan to always source suppliers globally now.
- With this heightened focus on international sales and global suppliers, 46% said the cross-border payments network has allowed their business to survive, with 35% now making and receiving more cross-border payments than they were prior to the pandemic.
Data from Mastercard’s 2022 Borderless Payments Report has revealed nearly four in ten (37%) small and medium sized businesses (SMEs) in the UK fear they will never achieve the same revenue levels as before the pandemic, although online business and international sales offer a real lifeline.
The research, which covered over 3,000 small businesses from around the world, highlighted that 75% of SMEs globally had to make changes to their business model to survive the pandemic – 62% in the UK – whilst 64% believe it has changed how they will do business forever.
Whilst 44% of businesses globally worry about hitting their pre-pandemic revenue, the positive is this figure is down from the 55% who expressed the same sentiment in 2020.
The pandemic has accelerated digital transformation, half (49%) of SMEs in the UK surveyed are now doing more online business – compared to the global average of 68%. Almost a quarter (22%) said they now do more business internationally, with 24% saying they would have folded during the pandemic if it wasn’t for these overseas opportunities.
In line with these findings, almost half (46%) of UK SMEs said the fact the global cross-border payments network kept running during the worst of the pandemic has allowed their business to survive. 35% said they are now making and receiving more cross-border payments than they were prior to the pandemic.
With almost four in ten (37%) UK respondents saying international sales enabled them to grow during the pandemic, 41% saying the pandemic opened up options for new international suppliers and 46% planning to always source global suppliers going forward, it’s clear cross-border payments will be a key focus for business growth in the UK, and therefore economic recovery, moving forward. In fact, almost a third (32%) of UK small businesses say the pandemic has allowed them to source more competitive quotes from suppliers across borders and 29% say using international suppliers reduces risk.
Stephen Grainger, Executive Vice President, Mastercard said: “The unprecedented disruption introduced by the pandemic has realigned UK and global economics, with many small businesses looking keenly towards prospects in new markets. With small businesses in the UK and across the world growing their international customer and supplier networks at pace, especially online, it’s crucial that financial institutions have the right cross-border solutions in place to support them.
“Cross-border payment systems must become faster, cheaper and more secure. Through a single point of access, Mastercard Cross-Border Services allows businesses to send and receive money safely and with the certainty they crave.”
Despite the importance of cross-border payments, there are clearly still frustrations for businesses in the UK with almost a third (32%) saying they slow down the supply chain.
Through partnerships with financial institutions around the world, Mastercard is empowering every business to address these issues and improve cross-border payments for both businesses and individuals. Mastercard Cross-Border Services allow people and businesses to send and receive money securely, and with upfront visibility of timings and fees to provide people and businesses with more confidence and predictability.
- ENDS -
The research was conducted by Yonder Consulting, who surveyed 3,074 SMEs in 15 markets between 2 December 2021 and 7 January 2022.