The outlook for Australian exporters is a positive one, according to the Australian International Business Survey 2016, an annual survey of Australian small business exporters.
The survey found that 97 per cent of SME exporters surveyed are involved in the export or import of goods, with 92 per cent planning on exporting in the year ahead, pointing to a strong export market for Australian business.
Trends for manufacturing exports
Of the 913 Australian businesses which responded to the survey, a third of respondents were manufacturing businesses. The top ten markets for manufacturing exporters are the United States (16 per cent), New Zealand (10 per cent), China (10 per cent), UK (7 percent) and Singapore (5 per cent).
Manufacturers expressed optimism about export opportunities, with 82 per cent planning on expanding into additional markets in the next two years. Interestingly, of the companies that had plans to expand into new markets, 17 per cent identified the United States as their likely destination, 12 per cent highlighted China, and 6 per cent expected India to be the next market they enter into.
Manufacturers are upbeat about the outlook for the industry in the year ahead, with 25 per cent saying the outlook is ‘much better’ and 47 percent describing it as ‘better’ than last year. Only 6 per cent of respondents said the outlook for manufacturing exporters is ‘worse’ in the year ahead.
Victorian manufacturer takes advantage of international opportunities
One manufacturer which is taking advantage of the opportunities available in international markets is Victorian manufacturer and family business, Worldpoly.
Established in 2000, Worldpoly now exports to over 108 countries worldwide, accounting for about 70% of total business.
Worldpoly specialises in manufacturing polyethylene pipe butt welding equipment. “Butt welding machines are primarily an alignment clamp which aligns two lengths of polyethylene pipe, shaves them, heats them and then forces them together under an international or national standard of temperature, time and pressure to give a lifetime of 100 years and a joint which will survive the failure of the pipe,” says Rob Hall, Managing Director and owner of Worldpoly.
With a focus on international markets, Worldpoly saw an opportunity to establish a new distributor in South Africa, further opening up the Sub-Saharan Africa market. Their bank was unable to help finance the venture because of the cashflow nature of extended terms to a foreign country.
Securing export finance
“The largest challenge to exporting is the cashflow required to match the credit terms, which are provided by foreign national competitors,” says Hall.
With the introduction of a new loan product specifically for small business exporters by Efic, the Australian government’s export credit agency, businesses like Worldpoly are able to access smaller, unsecured loans with flexible repayment terms.
“Efic’s funding allowed us to send our machines to a new distributor in South Africa. The Small Business Export Loan from Efic made this sale possible, and has allowed us to facilitate more stock in South Africa.
“Once we started the online application we were able to save it and return to it. Then once it was submitted, we were able to track the application through to completion,” says Hall.
“The key to Worldpoly’s success is our passion for the industry, and the fact that we’re never scared of a challenge. We project our partnership in South Africa will grow substantially over the next few years and will allow us to expand further into Sub-Saharan Africa.”
For more information of Efic’s Small Business Export Loan click here.