25 Nov Are More UK Construction Businesses Going Abroad?
In a recent study by Hitachi Finance, 22% of UK SME construction companies are seeking opportunities abroad.
Since the uncertainty of Brexit, small businesses have been looking at new markets overseas to achieve growth.
Described by Managing Director at Hitachi as a “clear sign that businesses are already adjusting to a worldview beyond the EU”, construction companies are taking on a global perspective.
This will come as a welcome move to the UK Trade & Investment chief executive, Nick Baird, who has been singing the praises of the UK construction industry since coming into the office and has urged companies to export their skills.
In an interview with Building Magazine, Nick Baird claimed that for too long the UK construction industry has been missing opportunities abroad.
The concept of going global is not a new one. French contractors such as Bouygues, are well-established in sub-Saharan Africa, while Germany’s Hochtiekf is active in both Rwanda and Russia.
So why are UK construction companies only just catching on to the possibilities of going global?
Nobody can deny the impact of Brexit here in the UK, and it is partly to blame for the international approach that many construction companies are taking with their growth plans.
Priorities have shifted for construction companies; seeing uncertainty in the UK economy and a government in turmoil has led contractors to look outside the UK for more security.
Working on a global scale is nothing new to the British. During the 1990s, UK contractors made up a large proportion of the European International Contractors Organisation (EIC). But UK membership has dwindled since 2000. It seems as though British contractors lost interest in doing business internationally.
However, there are some contractors who have made their success from going global. Balfour Beatty has reached the £10bn turnover mark and is one of only three British-owned contractors operating worldwide.
The UK construction industry is in high-demand from foreign clients. As well as our British construction heritage and education, the trade skills acquired in the UK are the most sought-after by international projects.
‘Buying British’ still remains a sign of high-quality craftsmanship, and it is due to this reputation that could provide UK construction firms with a competitive advantage over foreign competitors.
South Korean construction firms already have backing from their government to make doing business on an international level more accessible. So it’s now time for the UK to step up.
While the focus has been on home-grown projects, the Middle East, Asia and Africa are seeing a surge in development, opening up a wealth of opportunities for UK contractors.
At present Kier Construction gains 30% of the division’s business from overseas projects. This is set to increase according to recent reports from their development director.
Of course, going international is easier said than done. With the set up of operations abroad, both legal and commercial aspects of business differ from the UK, it may only be the bold who take the leap.