Two-thirds of small businesses looking to expand overseas: Report

And of those businesses that have already entered international markets, the majority are increasing their profits are have made significant gains.

In its inaugural Australian Business Growth Index, Airwallex found a third of SMEs surveyed (34 per cent) currently have operations overseas, but this is projected to more than double in the next five years.

The independent research, which surveyed more than 200 Australian SMEs, found that businesses already operating in international markets are experiencing commercial success. Of these businesses, two in five surveyed (42 per cent) reported being profitable and more than half are breaking even (52 per cent).

“Aussie businesses are bolstering their position to weather the current economic challenges,” said 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.”

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 that are already operating overseas and 99 per cent of those planning to do so in the next 12 months recorded growth last year. 

South-east Asia is the region where those SMEs that have ventured outside the domestic market are finding the greatest success, stated the report with almost two in five respondents (39 per cent) saying this market had been their biggest generator of revenue outside of Australia in the past year, closely followed by the US (29 per cent).

These markets were echoed in terms of where the most beneficial prospects lie, with a quarter (26 per cent) of SMEs operating or planning to operate overseas identifying south-east Asia as the most lucrative in the year ahead. 

The US followed closely behind south-east Asia, with 25 per cent of businesses with an international footprint or ambition naming the states out as the next most attractive market in the near future, surpassing China (18 per cent) and EMEA/UK (15 per cent).