Australian SMEs increasingly eye global expansion

A third of Australian SMEs have operations overseas, but this is projected to more than double over the next five years, according to Airwallex’s inaugural Australian Business Growth Index.

The survey of more than 200 Australian SMEs found that 42 per cent of those operating across borders are profitable and more than half are breaking even (52 per cent).

The region where they have enjoyed the biggest success is South East Asia. Almost two in five respondents (39 per cent) say this market had been their biggest generator of revenue outside of Australia over the past year, closely followed by the United States (29 per cent).

Indeed, 25 per cent of businesses with an international footprint or ambition name the US as the next most attractive market shortly, surpassing China (18 per cent) and EMEA/UK (15 per cent).

“Aussie businesses are bolstering their position to weather the current economic challenges,” says Sam Kothari, head of growth for ANZ at Airwallex. “International expansion is now being used as a strategy to remain resilient and viable by tapping into new markets and widening the pool of potential customers.”

He says moving overseas has unlocked new customer segments for SMEs and broadened their overall market share, with 80 per cent saying the volume of new customers they’ve gained from moving into new markets has been “significant”.

The research also found that despite sustained economic hardship, including rising inflation and disrupted global supply chains, 96 per cent of SMEs who are already operating overseas, and 99 per cent of those planning to do so in the next 12 months, recorded growth last year.

“Australians are innovators, and there is growing global demand for the products and services they provide,” adds Kothari.

“We have seen this firsthand; Airwallex is the chosen partner to many Australian businesses looking to alleviate the global roadblocks associated with setting up shop in international markets, including opening accounts overseas, high FX fees and managing employee expenses.”