A rare note of caution coming from UK businesses, in reference to BRIC economies.
The business advisory firm, Deloitte, has released its annual entrepreneurship report. It surveys about 350 entrepreneurs across the United Kingdom, and finds that the UK, Western Europe, and North America remain the preferred markets for growth.
Surprisingly, there’s an abundance of caution towards the BRIC nations, even though Brazil, Russia, India, and China represent 70% of global growth. Among the entrepreneurs surveyed, just 1.5% consider China as a prospect for the growth of their business. Less than 1% choose India and Brazil, and just 0.3% like Russia, despite its resurgent market.
Specifically, the survey asked: “Which geographic market represents the best opportunity for significant growth for your business over the next three years?” Expansion plans are predominantly focused on the UK market, although North America grew in favor over the previous year. Very few entrepreneurs are targeting the BRIC.
The head of Deloitte’s entrepreneurial business team, Tony Cohen, says “there’s less optimism and more caution for the BRIC because doing business there… opens up new risks. One has to look at culture, regulations, contacts, systems… North America speaks the same language. Western Europe is much closer.”
While entrepreneurs may be wisely managing risk as the economy recovers slowly, are they also missing out on opportunities in the fast-growing BRICs? Tony Cohen says, “It’s always possible…. But UK businesses appear happy to build growth in the UK for now, with a view to expanding in due course.”
The survey also finds that more than half (55%) of entrepreneurs surveyed expect short-term negative effects as a result of financial pressures on their business. However most report no change in their overall strategy as a result of the difficult economic times.
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