Seven-Year High for the Pound Holds Risks for British Businesses
UK businesses need to work harder at closing the language gap to overcome a more negative climate, argues the Association of Translation Companies
News that the Euro has tumbled against the Pound, hitting an 11-year low, has sparked concerns over the export potential for UK businesses, says the Association of Translation Companies (ATC).
The Euro weakened to $1.1115 against the Dollar last weekend, while the Pound reached a seven-year high of €1.34. While this may be good news for Britons who are looking for a cheap European holiday, it may make exporting abroad to these markets more difficult.
This is part of a wider national challenge where the UK is losing out on 3.5 percent of GDP in lost exports, due to a lack of language and cultural skills. The ATC has launched a campaign to help raise awareness of the value of foreign language skills when UK businesses are exporting.
Geoffrey Bowden, General Secretary of the ATC, explains his concerns over the stability of British SMEs: "With products and goods now more expensive to buy for consumers on the continent, UK exporters will have to take steps not to fall behind in the tougher climate.
“There is still an assumption by many UK businesses that everyone speaks English and that there is no need to translate business and marketing documents into local languages, but with a weaker Euro, many SMEs who have fewer resources will be at risk of losing out on these opportunities, and it is therefore important that specialist language skills in these European languages are prioritised.
“To know the language and understand the culture of the people you are trading with will give you an advantage because companies like to do business in their own language.
"In a difficult climate, businesses can often underestimate the importance of cultural needs, categorising them as a luxury and not a necessity. While European language skills may be convenient for personal use, the value of cultural knowledge when building relationships in business is critical. The ability to get to grips with a business culture may be the key to success or failure with the current exchange rate.
"As other European countries with the same currency will be in a better position to export to other European countries, having a key understanding of the culture and the language will push SMEs in Britain one step ahead. Businesses who have these skills in this climate will find their services in a much higher demand from businesses in Europe than those who aren't prioritising it," concludes Geoffrey.”