Overcome Global Market Access Challenges.
Global trends indicate that the Small to Medium Enterprises (SMEs) sector has experienced sustained growth and is the biggest employer in both the developed and developing world. According to Mohlomi (2019) SMEs contribute 70% of employment and generate 50–60% of the value added to the economy. Unfortunately, Mohlomi (2019) further states that 70% of SME fail within the first two years of being in business.
SMEs and Globalization:
Sadly, many SMEs face challenges to access international markets which makes them either avoid international markets or failing in their attempts. The rise in globalization has significantly increased competition and the United Nations realized that many factors affect the lower rate of participation of SMEs in international trade. There are internal constraints of higher vulnerability to market developments and high infrastructure costs, as well as lower productivity, including a lower level of digitization. The US International Trade Commission investigated the trade barriers for SME in the EU market in 2014. The findings pointed at the following cross-cutting trade barriers:
· Standards related measures resulting in high compliance costs.
· High tariffs and quotas.
· Difficulties involving trade secrets and patenting costs.
· Logistics challenges including customs requirements.
Overcoming Market Access Challenges:
SMEs should look at strengthening key partnerships, simplifying procedures and formalities through digitalization and gain vital knowledge of international regulatory and legal requirements. Furthermore, SMEs can benefit from the below lessons to overcome barriers to enter markets:
Lesson #1: Don’t Sugar Coat Reality — Plan for It
Lesson #2: Identify a Precise Need in the Marketplace
Participation in the global market space by SMEs allows the opportunity to scale up their businesses, enhance productivity and acceleration in innovation. Large companies often dominate the value chain making it difficult for SMEs to operate outside these value chains. Therefore, working within these value chains offer SMEs market access opportunities to participate in local and more importantly global markets. For example, your SME should become a supplier to a larger company that exports. However, this only provides a portion of the action so how can we get more, through entrepreneurial marketing.
Conclusion:
Your SME should develop a marketing plan and measure success. Thanks to the emergence of the digital age, there are more mediums to market your small business than ever before. The low barriers to digital marketing have opened the gates for small businesses to complete with large companies and that very important global market. Extending your reach beyond geographical and demographical barriers reaching your ideal customers. Lastly build those key partnerships to overcome barriers.
References:
· Amato, C. May 23, 2018. 3 Ways to overcome small business marketing challenges. Available from: https://cmasolutions.com/blog/3-ways-to-overcome-small-business-marketing-challenges/
· Heerkens, D. ‘Out Of Home Advertising Vs Digital Advertising — Choosing The Right One.’ Retrieved on April 8, 2021 from: https://2stallions.com/blog/out-of-home-advertising-vs-digital-advertising/
· Newton, C. February 5, 2021. ‘Advertising For Ecommerce’ Available from: https://www.klaviyo.com/blog/advertising-for-ecommerce
· Mohlomi, T. December 4, 2019. Breaking barriers to market access will help SMMEs in SA. Available from: https://www.news24.com/citypress/voices/breaking-barriers-to-market-access-will-help-smmes-in-sa-20191204
· United Nations — Trade Facilitation Implementation Guide. Retrieved on April 15, 2021 from: http://tfig.unece.org/contents/itinerary-11-start.html
