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SAP and Oxford Economics global study has revealed that SMEs are adopting a global course and Small and Midsize Firms That Do Business in Six or More Countries Will More Than Double in Three Years
As global ICT vendors are busy targeting the global SME segment, SAP and Oxford Economics has come up with a study which has revealed that small and midsize enterprises (SMEs) around the world and across industries are making major changes to their business models, products and go-to-market strategies. SMEs are also competing with larger companies by investing in technology to improve operations and become more efficient.
The survey of 2,100 executives from SMEs in 21 countries shows they believe they are equipped to compete with larger firms and have some clear advantages over them. The findings overturn some industry stereotypes of smaller companies as local or regional entities that are largely technophobic. The survey looked at SMEs with an annual turnover of US $20 million-$750 million across the globe.
“The overarching finding of the study was that successful SMEs are going outside of their home market to accelerate growth. And by doing so, they face fierce competition from large multinational corporations and more empowered customers in new markets,” said Eric Duffaut, president, Global Ecosystem and Channels, SAP AG. “In their new international or even global landscape, business network and latest technology innovations are more and more required by SMEs to evolve their business models and effectively compete.”
The study also reveals that as a result of their global aspirations, SMEs are expected to grow outside their home markets while facing increasing global competition at home. The number of firms expecting to generate as much as 40 percent of their revenue internationally jumps by 36 percent in the next three years.
Fifteen percent of respondents currently do business in six or more countries today, a figure that is expected to rise to 35 percent in three years based on survey responses. More than one-quarter of respondents cite increasing global competition among the top three trends affecting their business today. Nearly 60 percent say competition from companies in other countries has increased substantially in the past two years. And 59 percent say they are competing more with larger companies now than in the past.
