5 Financial Solutions to the Challenges of Cross-border Trade for UK Businesses

UK Businesses

UK SMEs face significant barriers in cross-border trade, with many grappling to align their growth ambitions with the realities of international commerce.

A survey by the CBI and Finastra revealed that only 44% of UK SMEs are currently engaged in international trade. Among those not trading internationally, one-third see the potential value but are deterred by perceived barriers and lack of support, highlighting issues such as the impact of Brexit (23%), feeling too small to trade internationally (16%), and limited knowledge about international markets (15%)​​.

Additionally, research by Airwallex shows that while 70% of UK SMEs remain optimistic about international expansion, they also recognize the need for strategic partnerships and technology adoption to navigate economic challenges and optimize productivity​​.

In this complex environment, tapping into outsourced virtual bookkeeping services becomes essential. Outsourced accounting services providers can offer the expertise and technological support needed to overcome these challenges, allowing UK SMEs to focus on their core business and growth in the global market.

Read this blog to learn about 5 financial solutions to the most common challenges of cross-border trade.

Challenge #1: Navigating Currency Exchange Fluctuations

Currency exchange fluctuations present a significant challenge for UK SMEs engaged in international trade. Research indicates that 42% of UK business proprietors have experienced financial losses due to currency volatility, with some confronting these impacts monthly​​. This underscores the crucial need for effective currency risk management.

To tackle these risks, SMEs can adopt currency risk management tools such as forward trades and option trades. Forward trades enable businesses to set exchange rates for future transactions, providing certainty and safeguarding against adverse market shifts.

Option trades offer similar advantages, with the added flexibility of capitalising on favourable rate movements. These tools, previously more accessible to larger corporations, are now increasingly available to SMEs, empowering them to manage their international financial exposure more effectively.

Challenge #2: Adhering to Diverse International Financial Regulations

UK SMEs engaging in cross-border trade often struggle with the complexity of adhering to various international financial regulations and reporting standards. Each country's unique tax laws and financial regulations can create a labyrinth of compliance requirements, increasing the risk of non-compliance and associated penalties.

To address these challenges, a practical solution for SMEs is to partner with firms specialising in international financial compliance. These experts can help navigate the different tax laws and financial regulations of various countries, ensuring legal compliance and effective financial planning in diverse markets.

By working with global compliance professionals, UK SMEs can confidently pursue international expansion. These partnerships can provide strategic insights and solutions, ensuring SMEs remain compliant and efficient in their financial operations, no matter the market.

Challenge #3: Managing Logistics in Different Countries

For UK SMEs engaged in cross-border trade, managing logistics and supply chains across various countries is a complex task. Each nation's unique shipping regulations, customs processes, and transportation networks pose distinct challenges, potentially leading to delays, increased costs, and supply chain inefficiencies.

To effectively navigate these complexities, UK SMEs can benefit from partnering with local logistics and supply chain experts. These partnerships offer:

  • Expertise in local customs and regulations, ensuring compliance and avoiding costly delays.
  • Knowledge of efficient shipping routes and transport methods, tailored to each region.
  • Solutions for regional warehousing and distribution, optimizing the supply chain within specific markets.
  • Risk management strategies to preempt and address region-specific logistical disruptions.

Collaborating with local logistics professionals allows SMEs to streamline their supply chain, ensuring timely delivery and cost efficiency. This not only enhances operational effectiveness but also enables SMEs to adapt swiftly to market changes, laying a solid foundation for successful international business growth.

By partnering with experts in local logistics, UK SMEs can significantly enhance the efficiency of their supply chains. This approach ensures goods are delivered on time and cost-effectively. It's more than just making operations run smoother; it's about being able to quickly adjust to changes in the market.

Challenge 4: Tackling Late Payments in International Trade

Managing late payments is a significant challenge for UK SMEs involved in international trade.

A survey found that 55% of UK small businesses still had outstanding invoices from the last tax year (2022/23), demonstrating how widespread the issue of late payments is​​. This problem can cause cash flow disruptions, affect business operations, and lead to a considerable amount of time spent chasing payments.

To effectively address this challenge, you can leverage virtual bookkeeping providers that offer a streamlined approach, including:

  • Automated Invoicing Systems: These systems can handle the issuance of invoices in various currencies and automate the sending of payment reminders, significantly reducing instances of late payments.
  • Proactive Management of Overdue Accounts: Virtual bookkeeping services take on the task of pursuing overdue payments. This proactive approach frees up the business to concentrate on core operations and growth.
  • Seamless Integration with Business Processes: By integrating with existing business systems, these services offer a unified view of accounts receivable, streamlining financial management and decision-making.

Challenge 5: Understanding Global Financial Markets

Lastly, for UK small businesses trying to make a mark in the global market, figuring out international finance can be quite a handful. It's not just about dealing with a bunch of different investment choices; there's also a whole maze of rules and regulations in each country to get your head around. Getting a grip on all this calls for some expert know-how.

With this in mind, you should consider teaming up with cross-border financial advisors. These experts offer more than just advice on navigating different market regulations; they're also crucial for guiding investment strategies.

Plus, they come in handy when it’s time to tap into international funding sources. With their help, businesses can make sure they're not just compliant with local financial laws but also positioned to make the most of global opportunities.


Stepping into international trade can be tough. It’s all about getting your head around those tricky finance bits and the different ways business is done around the world. But, it’s nothing a bit of expert help can’t fix. Teaming up with some savvy financial advisors who know their way around global markets can make a huge difference.

Contact our team at Sanay today so we can help you streamline your financial operations and support your international growth.