British IT exports braced for impact amid tariff threats

New research has shown that the information and communications sector has the second highest proportion of business that are exporters, with more than 20% trading overseas. However, the global trade landscape is set for another shake-up as President Trump's potential 100% tariff plan targets foreign computer chips and semiconductors. This move raises concerns about the future of British exports and prompts an examination into industries that might face the most significant impact.

According to a recent analysis by business finance experts at money.co.uk, the latest Office for National Statistics (ONS) data sheds light on the state of British exports and highlights the number of firms potentially at risk.

Top Exporting British Industries:

• Manufacturing: With 28,100 businesses involved, it stands as the leading exporting sector, representing 21.9% of its industry.
• Information and Communication: Home to 39,300 exporters, this sector accounts for over one in five companies (21.2%) in the sector. This group includes diverse fields like software development, telecommunications services, and digital media firms.
• Professional, Scientific, and Technical Activities: Boasting 82,100 businesses, these exporters represents 20% of their industry.
• Mining and Quarrying: Although smaller, with 200 exporting firms, it still accounts for 17.8% of its sector.
• Wholesale and Retail Trade: Tied with Arts, Entertainment, and Recreation, both sectors contribute 15.8% of their industries with their respective numbers of exporters being 61,000 and 11,400.

Amid global uncertainties, Joe Phelan, a business credit cards expert at money.co.uk, shares the challenges faced by exporters. He emphasises the need for a flexible approach, whether by exploring new markets, product diversification, or adjusting supply chains. For small and medium enterprises (SMEs), international trade presents unique financial pressures. Extended shipping timelines, duties, tariffs, and fluctuating currency rates require prudent cash flow management. In this light, Phelan highlights the importance of financial tools, such as business credit cards, in providing the cash flow and, hence, resilience companies need: “A well-chosen business credit card helps bridge payment gaps, covering upfront costs like worker payments and unexpected freight or duty charges. The interest-free period ensures that SMEs maintain cash flow while awaiting international earnings.”

As the landscape continues to transform, British businesses are encouraged to stay adaptable, ensuring the continued growth and success of the UK export economy.

You can access the full report here.