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Country Commercial Guide - Doing Business in the UK

Introduction to the UK Country Commercial Guide 2013

The Country Commercial Guide (CCG) is a comprehensive annual review of the United Kingdom's commercial, economic, political and investment environment.  The information contained in the CCG will assist U.S. companies who wish to do business in the UK.  Below you will find the introductory chapter of the CCG, which includes the UK market overview, its challenges, opportunities and market entry strategy.  The remainder of the CCG consists of the following chapters:

  • Political and Economic Environment
  • Selling U.S. Products and Services
  • Leading Sectors for U.S. Export and Investment
  • Trade Regulations, Customs and Standards
  • Investment Climate
  • Trade and Project Financing
  • Business Travel
  • Contacts, Market Research and Trade Events
  • Guide to Our Services

Download the full 2013 guide with easy access to Chapters above: 

UK Country Commercial Guide 2013.pdf

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Market Overview

  • The United Kingdom (estimated 2012 GDP of $2.4 trillion) has the sixth-largest economy in the world, the third-largest economy in the European Union, and is a major international trading power.
  • Highly developed, sophisticated, and diversified, the UK market is the largest in Europe and the fifth largest in the world for U.S. goods exports. The UK is the second largest market in the world for U.S. service exports.
  • Major categories of U.S. exports include aerospace, automotive, electronics, healthcare, information technologies, telecommunications, and safety/security equipment.
  • With few trade barriers, the United Kingdom is the entry market into the EU for over 41,000 U.S. exporters.
  • U.S. exports of goods and services combined were valued at more than $110 billion in 2012.
  • The United Kingdom remains the number one overseas market for travel to the United States, and slightly fewer than 3.9 million UK travelers visited the United States in 2012.
  • The U.S.-UK investment relationship is largest in the world with a cumulative bilateral stock in direct investment valued over $990 billion. Over two million jobs, approximately one million in each country, have been created over the years to manage and drive this investment.
  • Over 7,500 U.S. firms have a presence in the United Kingdom which is also the top location in Europe for U.S. regional headquarters covering Europe, the Middle East, and Africa.
  • A major international financial, media, and transportation hub, London is also headquarters to the European Bank for Reconstruction and Development (EBRD).

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Market Challenges

  • The UK economy grew by 0.3% in 2012, reflecting continued weakness in the economy. There are some signs that the economy is beginning to pick up with additional growth of 0.3% in the first quarter of 2013.
  • The continuing difficulty in accessing credit, particularly by SME’s, still represents a challenge for many businesses.
  • Weak consumer confidence and broadly static wages continue to dampen retail sales, and several well-known high street brands have disappeared as a result of severe financial difficulties.
  • Despite the advantage of a relatively strong U.S. dollar, London is one of the world’s most expensive cities to do business.
  • As UK and third-country suppliers represent strong competition, U.S. exporters need to offer differentiated products at competitive prices.
  • Complex EU technical/regulatory requirements can be burdensome.
  • “Devolved Administrations” present some differences in policies and regulations among England, Northern Ireland, Scotland and Wales.
  • The UK government has introduced deep cuts to public sector funding, affecting many businesses and, more broadly, consumer confidence.
  • A debate has arisen about the UK’s future membership in the EU with the suggestion of an ‘in or out’ referendum possibly taking place sometime in the next four years.

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Market Opportunities

  • The United Kingdom is a highly sophisticated market with strong demand for products and services that improve productivity, including ICT software and services that lower costs and improve business efficiencies.
  • There is ongoing, strong demand for a wide range of equipment and services related to safety/security and, in particular, for cyber security.
  • The United Kingdom’s commitment to low-carbon targets is driving market demand for U.S. products and services in the area of renewable energy, energy efficiency, low carbon/green technologies, smart grid technologies and e-vehicles.
  • The proposed U.S.-EU Transatlantic Trade and Investment Partnership (TTIP) has the potential to cut tariffs and address market barriers, thus creating additional opportunities in the UK for U.S. exporters.

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Market Entry Strategy

  • Demonstrate a clear value proposition and competitive advantage (i.e., price, quality, branding).
  • Pay close attention to both the obvious and subtle cultural differences between the United States and the United Kingdom and adjust marketing strategies accordingly.
  • Evaluate prospective partners carefully and choose an experienced, well-established local distributor.
  • Be flexible working with a UK partner during this challenging and prolonged period of economic recovery.
  • Express commitment to the market with a long-term perspective.

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