Confidence is growing among UK online retailers that they can grow international sales, a study by Royal Mail has found.

Two thirds (65 per cent) of UK SME online retailers are aiming to increase international sales in 2015. This is up two thirds on a year ago when just four in ten (39 per cent) said they were planning to increase overseas sales in 2014.

Royal Mail’s annual tracker study into the expectations and challenges facing UK SME online retailers revealed that they will be targeting new international markets to support their growth. Eight in ten (84 per cent) of companies surveyed said they plan to target new countries they do not currently sell to.

The study found UK SME online retailers revealed are in positive mood for the year ahead with seven in ten businesses expecting overall sales to increase. The optimism for growth – which is up nine percentage points on last year - is despite 76 per cent of SME online retailers saying competition is more intense than a year ago.

USA overtakes Europe as the top overseas target

The USA has overtaken Europe as the top target for online retailers looking for new international markets, suggesting UK SME online retailers believe there are greater opportunities in the USA. The US economy is forecast to grow at 3.6% in 2015 compared to 1.2% in the Eurozone. Meanwhile, the dollar has strengthened while the Euro has weakened, meaning Sterling is more competitive in the US than Europe.

Four in ten (39 per cent) of SMEs surveyed said they would be targeting the USA - up from 23 per cent a year ago. Meanwhile, 30 per cent said they would target European countries. The study found that Canada ranked third in new international target markets for UK online retailers. Despite the falling value of the Rouble, 15 per cent of SMEs said they would target Russia this year. Last year only 9 per cent said Russia would be a new target market in the year ahead.

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Source: Royal Mail