Australian businesses looking to enter the UK market are being encouraged to enter Go UK, a business plan competition designed to boost investment in the region.
Launched by government department UK Trade & Investment, Go UK is open to all Australian and New Zealand businesses with an interest in expansion to the UK.
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Successful applicants receive return airfares to London, where they have access to potential business partners, client contacts, business networks and services.
Richard Morris, director general of UK Trade & Investment in Australia and New Zealand, says now is an ideal time for Australian businesses to expand into the UK.
According to Morris, the UK is the easiest place in Europe to do business, with the least barriers to entry in the world.
“Just as Australia can be a gateway to Asia, the UK is the gateway to Europe… It doesn’t matter what your line of business [is],” he says.
“The Australian dollar is buying more than it has for many years and the UK economy is poised for a decade of growth, especially with the London 2012 Olympics just around the corner.”
In addition to its status as a financial services centre, Morris says the UK is a major player in manufacturing, aerospace, life sciences, ICT and creative industries.
According to Austrade senior economist Tim Harcourt, the UK is the third most popular export market for Australian SMEs, beaten only by New Zealand and the United States.
“It’s always been [a result of] the ‘Kylie effect’,” Harcourt says.
“No matter what the state of the UK economy, Australian exporters make a beeline for London before venturing across the [English] Channel or the Atlantic, just as… Kylie Minogue did.”
“So where are the gains being made into the UK market? Australia does pretty well in food and beverage, informational technology and professional services.”
“The strong UK labour market has provided opportunities for Australian labour market services firms such as NeoProducts and gumtree.com.”
Harcourt says it’s common for Australian companies to position themselves in the UK before venturing into the rest of Europe.
“People complain about ‘Channel fever’ but it makes sense in terms of language and culture [to enter the UK market first],” he says.
However, he says companies tend to be less cautious in English-speaking countries, urging businesses to do their research regardless of where they are.
“When I’ve done studies of people losing money [in business], they often lose money in English-speaking markets… They often get in trouble with IP and things,” he says.
“Just because you can speak the language, doesn’t mean you don’t do your due diligence.”
Harcourt says Asia is becoming an increasingly attractive alternative to the UK, despite the language and cultural barriers, because of its economic growth and proximity.
“Eleven out of 20 Australian exporter destinations are in Asia… [due to] the rise of East Asia and Australia’s increasing economic integration in the region,” he says.
“All this focus on Asia has made it difficult for Europe to get [a] profile.”