Many mid-market companies are redeveloping their international ambitions after having scaled back during the pandemic.
As shown in the latest figures from Grant Thornton’s research, conducted between October and December 2020, more companies are deciding to shift their focus towards international markets in their post-pandemic strategic plan. This global trend is important as it highlights game-changing opportunities internationally for all mid-market companies and Canadian businesses are seizing up this occasion in the market to grow.
Changes in the market leads to a boost in entrepreneurialism
Before the pandemic, many compagnies across Canada were active internationally and growing their market worldwide as part of a pre-existing plan. However, the recent economic and market changes have opened doors for many more Canadian compagnies to speed up their plans as a direct result of COVID-19. In fact, the latest figures from Grant Thornton’s latest research reveals that 20% say that they only started to increase their focus on international markets since the outbreak of the pandemic.
Additionally, significantly more Canadian mid-market companies (24% in H2 2020 vs 15% in H1 2020) are now expecting to increase their ratio of employees focussed on international markets in the next 12 months. This renewed appetite among the mid-market, even as the pandemic lingers, perhaps best demonstrates the sort of entrepreneurialism we have here in Canada.
Abundant sales opportunities are drawing companies abroad
The re-embracing of international sales is likely to be very significant in positioning the mid-market for growth during and beyond the pandemic and is a reminder of a key characteristic of our businesses. This shows how they are able to see the trends and opportunities in the marketplace and then adapt quickly to take advantage of them.
Below we show how COVID-19 has impacted those increasing their international sales focus. Competitive changes are a key theme here, with 48% mentioning the opportunity to form new international relationships due to the departure or failure of competitors. Another 39% mention the lower levels of competition in international markets, underscoring the competitive disruptions and shake-out from COVID-19.
COVID-19 factors contributing towards international focus according to entrepreneurs:
- Opportunity to form new international relationships from the recent departure/failure of competitors: 47.5% of businesses;
- Lower levels of competition in international markets due to COVID-19: 39.3% of businesses;
- It has become easier to take products or services internationally: 37.7% of businesses;
- Stimulation of international demand due to COVID-19: 32.8% of businesses;
- Internationalisation of your supply chain making overseas markets more accessibles: 29.5% of businesses;
- Sales disruption in your domestic markets from COVID-19: 26.2% of businesses;
- Beneficial government stimulus programs in international markets due to COVID-19: 24.6% of businesses;
- None of the above: 6.6% of businesses.
The other major incentive is customer demand, with 33% seeing stimulation of international demand due to COVID-19 and 25% mentioning the positive benefits of government stimulus programs. With positive indications on both the customer and competitor side, it’s easy to see why another 38% say it is now easier to take products and services international. Although other factors like the rise of digital communication will also be at work here.
A once in a generation opportunity to grow internationally
All of this data points to what we think is a once in a generation opportunity to grow business internationally, and one that all mid-market leaders should be aware of. As in any gold rush, it pays to think before joining the rush. Our leaders stress the importance of being strategic in your decision-making. We encourage businesses to identify where they will have the most impact. Furthermore, the importance of looking beyond the immediate and thinking about the medium and long-term goals, with clear priorities and action plans that are also backed up by scenario planning, to support resilience.
For those companies wanting to exploit these opportunities will need to be both growth ready as well as agile. Our team of experts, along with our international solution offer can help you conquer new frontiers.
04 Jun 2021 | Written by :