EVEN THOUGH MANY small and medium sized businesses in Sweden are subcontractors to bigger export businesses, there are still few that have direct exportation with the world market. Most of them are temporary export agencies that stay within the close region. Being a temporary export agency is most of the time about reaching out when the domestic market is not good enough.
THIS IS THE SITUATION today. According to Swedbank and SILF Purchasing Manager Index the inflow of orders from the domestic market is at least as weak as the export market. When broaden the market, the companies are in a better situation when the recession becomes more obvious in Sweden. Simultaneously, according to Swedbank and Företagarna the small business barometry shows that the companies with the primary final customer on the export market predicts the best expansion possibilities and they are also the ones that are most optimistic about the future. This also applies when the world surrounding economic situation slows down. An SOU investigation about export and internationalization was recently published and it shows that export businesses overall are more productive and pay higher salaries than non-export business within the same type of business.
ANOTHER MOTIVE TO WHY it is the right time to establish a company abroad, especially when it comes to buy-in and production abroad, is that many booming-economies are going through a phase of consolidation focusing on competitiveness. Households and companies must lower the depts which results in lower conjuncture. After some time of risen imbalances, particularly in East and Central Europe the pay increase must be lowered to reasonable levels and the production must improve even further. This countries´ main purpose must be to attract direct investments and keep them in the long term perspective.
THERE ARE STILL GOOD REASONS to specialization and division of labor in the Baltic sea region which includes for example Poland, Russia and the Baltic States. This process continues to converge towards the average in the European Union but it is not quite there yet. In order to speed up the convergence it is now even more important that the real salary progress is based on productivity research and a bigger value added in the production. One way to get there is to continue to attract Nordic direct investments especially in the areas of manufacturing, tourism and other services. Despite the risks that are usually associated with recession and financial crisis it could be a good opportunity for Swedes to establish their companies abroad. Especially if they view it from the long term perspective and want to expand.