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10 YEARS OF TECH EXPORTS IN EUROPE

RS Components

Technology is becoming critical to our industries and lifestyles across the globe, and it’s no longer tech giants that are competing to have the latest innovations, but countries also as they desperately attempt to take the lead in the technological boom of the twenty-first century.

Analysing the high tech export figures of each country is a crucial indicator of their commitment to driving forward investments in tech and essentially the effort they are making to become a more technological nation. High tech exports are essentially products that require significant resources and research in order to develop and produce, and have a variety of benefits both for the exporter and importer. Coming in a variety of forms from technical guidance and assistance, to the transference of industrial property and rights, the granting of licenses related to business management or even pertaining to patent rights and utility model rights, exporting high-technology can be extremely profitable and advantageous for a country in the digital world we live in today.

A major benefitter of high-tech exports includes the significant profits it can produce, which will boost a country’s economy as a result, especially with the tech industry being the largest in the world economy by significant amounts. For the importer there is also value as it can save money and be beneficial to the economy, with time and money essentially being saved as they pay for technological innovation to be brought to their country, rather than researching it themselves. Tech exports can also be greatly beneficial in developing countries who do not have the resources to drive themselves forward in the technological boom, and so instead, use other countries exports to better the living standards and security of their own country. High-tech exports mainly feature in the following industries:

  • Aerospace

  • Computer

  • Pharmaceutical

  • Scientific instruments

  • Electrical machinery

The rise of tech exports over the last decade in Europe has been staggering, as countries with very low export values in 2006 have skyrocketed over the last ten years, becoming the fastest growing in the continent. Competing for the latest developments and innovations to set their industries apart from the rest, which countries are making the largest steps in this fast-paced, ever-changing technological era?

RS Components has analysed 10 years of high-tech export data from The World Bank to see which countries are enjoying the most and least growth. You can view the map here.

Below are the top five countries with the highest average annual growth rates (AAGR):

Country name

2006 High-tech Export Value

2016 High-tech Export Value

10-year AAGR

Albania

$3,968,947

$8,424,644

155.2%

Azerbaijan

$9,073,107

$9,132,464

41.1%

Montenegro

$3,502,499

$2,778,804

31.9%

Armenia

$5,101,971

$21,142,634

21.5%

Romania

$1,236,505,248

$4,297,656,941

19.7%

Albania takes top place with a staggering growth of 155.2% in its high-tech exports across ten years, going from $3,968,947 to $8,424,644 . Albania’s growth far surpasses the rest of the continent, with a growth percentage at least three times higher than any other European country, with its primary trading partner remaining as the European Union (EU). With just 2.9 million people, this upper/middle-income country has done extremely well in rising the ranks as a European tech nation.

In second place is Azerbaijan with an average annual growth rate of 41.1%, going from $9,073,107 to $9,132,464. The positioning of the country reveals a great deal about its export business, as its location joining southwestern Asia and southeastern Europe sees 49.9% of its exports delivered to European countries and 46.4% sold to Asian importers.

But not every European country has seen an increase in their high-tech exports, with the below table revealing the five countries with the lowest average annual growth rates (AAGR);

Country name

2006 High-tech Export Value

2016 High-tech Export Value

10-year AAGR

Finland

$13,987,000,000

$3,328,914,557

-11.8%

Malta

$1,511,533,485

$578,385,642

-8.2%

Luxembourg

$1,328,907,021

$774,006,008

-4.3%

Georgia

$65,778,042

$19,807,885

-4.2%

United Kingdom

$119,360,000,000

$68,280,000,000

-4.1%

Finland ranks as the European country with the lowest average annual growth rate, as their figures have actually shrunk, leaving an average growth rate of -11.8%. The United Kingdom also features in the bottom five, seeing an average annual growth rate of -4.1%.

So which country will be leading the way in high-tech exports in another decade’s time?

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Finance

HOW TO MANAGE YOUR CASH FLOW IN UNCERTAIN TIMES

CASH FLOW

While the world is constantly changing, probably at a faster pace now than ever before, businesses need to manage cash flow and costs to drive success in uncertain times, says Matthew Thorpe, partner at Haines Watts Essex.

 

Managing people and expenses

There are certain costs that you just can’t avoid as a business – to keep your operation running seamlessly, but scrutinise the detail and cut down on any non-essential expenses. Check things like your SaaS subscriptions and look out for costs that auto-renew and if you do cancel, remember to also cancel your direct debits too.

You might want to put a freeze on hiring new people, but ensure that other roles and responsibilities are clearly and efficiently assigned across your team. The Coronavirus Job Retention Scheme (CJRS) has been introduced by the Government to help UK employers access support to continue paying part of their employees’ salary to avoid redundancies. Affected employees are classed as “furloughed workers”.

Once furloughed, the employee cannot work or they will not qualify for the scheme. For businesses that perhaps need to go further, there may be some roles they don’t need any more, but businesses should work sensitively with people to manage this.

 

Cash is king

In uncertain times, owner managers will need to keep operations going to ensure financial stability. You should look to manage debt more efficiently by negotiating extended payment terms with creditors. You could also renegotiate loans for longer repayment terms to give yourself a lower monthly payment, helping the business to set some cash aside each month.

 

Daily forecasting

As a business owner, you need to create a cash flow projection and update this regularly if you are to improve things. You can do this using financial information to create a picture of how the business will look in the next 12 months. The forecast needs to show revenue sources and expenses, which will show the ups and downs of business income and can be used to make sure that enough finance is in place.

 

Good house-keeping

While banks and other finance providers recognise that the cashflow of a business may be disrupted by the impact of Covid-19, they are still going to want to see that you are viable and continue to trade in these uncertain times. Make sure your business is organised and don’t let disorganisation cause unnecessary issues. You can evidence this by having detailed forecasts; current order books and projections (as best as possible).

Having instantly accessible, accurate financial information allows you to plan effectively, spot issues before they become problems and manage your money in the most efficient and rewarding way.

 

Embrace technology

Software is now incredibly user-friendly and accessible from anywhere. For a business owner embracing the technology, this means:

  • Invoicing can be done instantly when a job is complete, emailed to the customer with an easy to use link to a payment platform.
  • Comparison websites can automatically monitor and help maintain lowest cost for things such as light & heat, insurance etc.
  • Technology can be used in place of face-to-face meetings. It can also enable them to adapt production lines to different demands.

All of these things and more, used properly, can make managing your business finances quicker, easier and often cheaper.  You will also be able to bring clarity to where your business stands and prepare for the next steps.

 

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Finance

HOW FINANCIAL SERVICES CAN GET TO GRIPS WITH RISING SUPPLY CHAIN RISK

FINANCIAL SERVICES

By Alex Saric, smart procurement expert, Ivalua

 

UK businesses have never been more dependent on their suppliers to help them deliver goods and services to their customers. Be it retail, manufacturing or financial services, suppliers have a vital role to play when it comes to innovation and meeting customer expectations. However, as supply chains become increasingly global, businesses are potentially exposing themselves to more risk than ever before.

This is especially true in financial services. Whether it’s the impact of geopolitical events like Brexit or global tariff wars, supply shortages, security or the businesses impact on the environment, an organisation’s failure to identify and mitigate risk could see millions wiped off its share price, and its corporate reputation left in tatters. Risk can present itself anywhere and at any time, so financial services firms must be ready to address it. However, many simply don’t have the ability to evaluate suppliers for risk factors, leaving them wide open to business operations being hindered, or being slapped with financial penalties.

 

More suppliers, increasing risk

One reason why financial services firms aren’t able to evaluate suppliers is the breadth and scale of today’s supply chains. For example, French oil company Total said in in a recent human rights briefing paper that they work with over 150,000 direct suppliers worldwide. This is just one example of how large and varied the roster of partners has become. Research from Ivalua has found that financial services businesses on average are working with around 3,600 suppliers annually, which is evenly split between UK-based and international partners. That number is expected to rise, with 60% expecting the number of suppliers they work with to rise.

The expanding nature of suppliers is only going to expose financial services firms to more potential risk than ever before, yet 78% say they face challenges gaining complete visibility into suppliers and their activities.

A lack of supplier visibility leaves businesses unable to identify and mitigate against supply chain risk. In fact, almost three-quarters (73%) of financial services firms have experienced some type of risk during the last 12 months. These include; supplier failure (43%), environmental impact, such as pollution or waste (35%) and supply shortages (45%). Supply shortages can be among the most damaging to a business, as seen by both the KFC chicken shortage which closed stores, and the summer 2018 CO2 shortage which caused companies such as Heineken and Coca-Cola to pause production, impacting supply across Europe during the World Cup.

 

Businesses unprepared for the worst

One way financial services firms can better prepare for risk is to ensure they know what to plan for to reduce the impact. However, whilst some say they have a contingency plan in place to deal with risk, many of them are unprepared. Financial services firms admitted to not having comprehensive and deployed contingency plans in place to prepare the supply chain for risk such as; natural disasters (68%), supply shortages (67%), geopolitical changes (65%), environmental impact (63%), supplier failure (62%) and modern slavery (50%).

In order to effectively prepare for these types of risks, it’s vital that financial services businesses fully understand their suppliers, their business environment, global variations in regulations, geopolitics, and a host of other factors. But for many, there are multiple challenges when it comes to gaining this understanding. A prevailing factor is an inability to gain visibility into all suppliers and activity because supplier management data is stored in multiple locations and formats, making insights difficult to access. This leaves teams unable to review supplier activity and assess compliance.

 

Making supplier management smarter

It’s imperative that financial services businesses are able to respond or prepare for supply chain risk. Clearly, much more needs to be done to ensure they have complete visibility of suppliers, especially in an era where regulators can levy heavy fines for GDPR breaches and scandals spread in minutes over social media. These types of risks can be reduced in the future if procurement teams have a 360-degree view of suppliers which will help with contingency planning and risk management.

For example, in the instance of supply shortages, plans could be put in place that identify alternative suppliers to ensure any shortages do not impact end users. This type of supplier collaboration is paramount when it comes to managing and mitigating against supplier shortages. When it comes to regulations, financial services firms can’t allow a lack of visibility to limit their ability to ensure all suppliers are compliant.

To do this, teams must take a smarter approach to procurement that gives complete visibility into suppliers throughout the supply chain. This will allow financial services firms to identify and plan for risk, reducing the potential damage, and ensuring they are working with and awarding business to low-risk suppliers. Supply chain risk is rapidly becoming an overarching concern for financial services firms, but by providing the ability to assess suppliers, they will have all the insights they need to mitigate the impact on business operations.

 

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