One in three UK SMEs plan international expansion in 2025

A third of UK small and medium-sized enterprises (SMEs) that do not currently trade abroad intend to begin doing so this year, according to new research from Shawbrook.

The survey found 38% of SMEs are already operating internationally, while a further 32% plan to start within the next 12 months. Only 28% have no plans to expand beyond the UK.

Larger firms are leading the push. Among businesses with annual turnover between £100 million and £500 million, 38% said they plan to expand overseas, compared with just 22% of those with turnover between £1 million and £5 million.

Europe is the top target market, cited by 80% of SMEs planning international trade. North America (38%) and Asia (33%) followed, with lower levels of interest in South America (21%), Africa (18%) and Australasia (18%).

Neil Rudge, Chief Banking Officer at Shawbrook, said that growth over the past year has given many SMEs the confidence to expand abroad.

Rudge also pointed to domestic pressures such as rising National Insurance contributions and high business rates: “A perfect storm of business challenges in the UK has opened the door for a large proportion of SMEs to expand into international markets,” Rudge said. “While it’s positive to see SMEs with the confidence and capability to expand internationally, it’s important they do so to complement their UK operations – not replace them.”

He added that many SMEs will be looking to the Autumn Budget for government measures to support growth at home as well as abroad.