FedEx Research Shows Hong Kong SMEs Continue To Expand Their Global Footprint
HONG KONG, August 8, 2018 — Recent research commissioned by FedEx Express, a subsidiary of FedEx Corp. (NYSE: FDX) and the world’s largest express transportation company, reveals that Hong Kong small and medium enterprises (SMEs) are exporting as much within Asia Pacific as they are to other regions. More than 70% of these SMEs are now engaging in exports, a significant increase over the past three years.
The study also shows that emerging industry 4.0 technologies and the thriving digital economy, including e-commerce, mobile-commerce and social commerce, are key factors driving the growth of SMEs as well as helping SMEs overcome challenges in this highly competitive environment.
“Local SMEs are facing a rapidly-changing business environment,” said Anthony Leung, managing director, FedEx Express, Hong Kong and Macau. “We are pleased to see that local SMEs are increasingly expanding their global footprint and are generating more revenues from exports. FedEx Express is committed to supporting businesses going global, and as one of the main logistics providers in Hong Kong, we will continue to support SMEs with the right resources and tools to meet their needs.”
Exports accounting for total revenues of Hong Kong SMEs have increased over the past two years
According to the research, exports now account for 88% of the total revenues of Hong Kong SMEs, which is equivalent to HK$11.278 million and higher than the Asia Pacific average of HK$9.415 million. The total export revenues of Hong Kong SMEs have increased by 24% (HK$9.056 million) over the last two years. China (52%), Taiwan (37%) and Japan (30%) are the top export markets among Hong Kong SMEs in the Asia-Pacific region, whereas Europe and Central/South Asia are the top export markets outside the Asia-Pacific region.
Hong Kong SMEs expect to increase their exports and imports over the next 12 months
More than one third, or 39%, of Hong Kong SMEs expect their exports in Asia Pacific to increase in the next 12 months, while 32% of them expect their exports outside of Asia Pacific to increase in the next 12 months. The optimism of the SMEs is driven by the strong growth of the global economy, especially the fast-growing economies in the Asia-Pacific region.
Some 30% of Hong Kong SMEs expect to increase their imports in the next 12 months. Also, 55% of Hong Kong SMEs agree imports will help them lower their production costs by sourcing goods overseas at a lower cost, while more than 40% of them agree imports will help them improve the variety and quality of their products.
Customs procedures and currency exchange remain the biggest challenges
Hong Kong SMEs are facing various operational challenges in expanding their business globally. More than 50% of Hong Kong SMEs agree customs procedures and currency exchange issues are their biggest challenges.
Social commerce is changing the SME business landscape
Most Hong Kong SMEs are already using e-commerce (87%) and mobile-commerce (79%) to source goods and find new customers outside of Hong Kong. The research shows that more SMEs are leveraging the power of social media in expanding their businesses. An overwhelming 8 out of 10 SMEs are now using social media, with more than half (52%) using this channel to export their products or services to overseas customers. Up to 26% of total revenues of SMEs are generated from social commerce, with 57% of them expecting to grow their businesses from social commerce over the next 12 months.
SMEs are harnessing new technologies to improve supply chain and distribution channel efficiencies
In addition, SMEs are harnessing new technologies to grow their businesses, with 62% of them agreeing that new technologies will help improve their supply chain and distribution channel efficiencies. Among current users, automation software (80%), mobile payments (72%) and big data analytics (71%) are the top technologies SMEs are deploying. They also expect to increase the usage of mobile payments (62%), big data analytics (59%) and 3D printing (52%) in the future.
About the Research Study
The independent study, entitled “Global is the New Local: The Changing International Trade Patterns of Small Businesses in Asia Pacific”, was conducted by Harris Interactive on behalf of FedEx Express to offer insights into import and export opportunities and challenges facing SMEs. The results are based on interviews with 4,543 senior executives of SMEs conducted online or by telephone in nine markets in Asia Pacific between March and April 2018. The markets included in the research were Mainland China, Hong Kong, Japan, Malaysia, Philippines, Singapore, South Korea, Taiwan and Vietnam. Interviews were split equally by market with a representative mix of company sizes: micro (1-9 full-time employees), small (10-49 full-time employees) and medium (50-249 full-time employees). The sample size was approximately 500 respondents per market.
About FedEx Express
FedEx Express is the world’s largest express transportation company, providing fast and reliable delivery to more than 220 countries and territories. FedEx Express uses a global air-and-ground network to speed delivery of time-sensitive shipments by a definite time and date supported by a money-back guarantee.
About FedEx Corp.
FedEx Corp. (NYSE: FDX) provides customers and businesses worldwide with a broad portfolio of transportation, e-commerce and business services. With annual revenues of $65 billion, the company offers integrated business solutions through operating companies competing collectively and managed collaboratively, under the respected FedEx brand. Consistently ranked among the world’s most admired and trusted employers, FedEx inspires its more than 425,000 team members to remain focused on safety, the highest ethical and professional standards and the needs of their customers and communities. To learn more about how FedEx connects people and possibilities around the world, please visit http://about.fedex.com.