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French SMEs show strong resilience in export markets
In his newly released book, “Success stories françaises à l’export,” Fabien Piliu highlights French SMEs that have successfully expanded abroad. However, others find their growth being hindered. Here is a detailed look at the reasons why.
A common cliché often pits German and French SMEs against one another: the former are seen as far more successful on the international stage than their counterparts across the Rhine. Another deeply ingrained prejudice is the idea of two-speed French exports, where large corporations are perceived as highly dynamic, while SMEs are seen as lagging behind.
This observation warrants significant nuance. ” *French mid-cap companies (ETIs) hold their own when compared to the renowned German Mittelstand in terms of innovation and international expansion.*, notes Béatrice Collin, professor of international strategy at ESCP Europe. *Furthermore, trade balance statistics account for product sales rather than services, a sector in which the French maintain a very strong presence*.”
Resourcefulness
A recent book (“Success stories françaises à l’export,” by Fabien Piliu, published by Éditions du Cherche Midi) follows this same trend, presenting about twenty examples of SMEs that have successfully expanded abroad. These companies generally benefit from a specific expertise that makes them unique in the eyes of their clients. ” *In Russia, French SMEs are generally expected to focus on consumer goods and high-end products*, explains Philippe Pégorier, Ubifrance sales advisor in Moscow. Another example: in India, French SMEs are more frequently sought after for professional equipment. The country also faces significant needs in renewable energy, such as solar, wind, and biomass.“, indicates Patrick Manon, Director of Ubifrance in India.
But positioning doesn’t explain everything. ” *What connects these various companies is a drive, an appetite for growth. They require resourcefulness and a spark of ingenuity to thrive in business.*” , explains Fabien Piliu, journalist and author of this book. In other words, the success of the operation relies heavily on the leader’s personality and drive.
Are they playing it a bit too “personal”? French SMEs are reportedly suffering from relative isolation when venturing beyond the borders of France. ” *From this perspective, we could draw inspiration from Germany, as well as from the British and Italians, who operate much more collaboratively in foreign markets*, continues Fabien Piliu. However, according to SME executives, large French corporations generally show little solidarity with their compatriots. *The Germans do it well, through informal relationships between players within the same industry*, notes Béatrice Collin. This is an observation that Ubifrance advisors do not share. *Successful SMEs tend to arrive in groups, often riding the coattails of large corporations*, Philippe Pégorier insists. But they are also managing to break free from their mentors. *In India, equipment suppliers such as Faurecia or Valeo have established themselves near the local automakers that serve as their clients*“, indicates Patrick Manon.
Strengthening banking relationships
Avoiding imitation is also a critical challenge. For niche players, originality or a technological edge makes all the difference. Concerns specifically involve trade relations with China. ” *Some companies have preferred not to enter the Chinese market directly, opting instead to start in Vietnam, Laos, or Cambodia. These are smaller markets where French-speaking partners can still be found, allowing for more manageable relationships compared to those in China.*“, notes Fabien Piliu. More broadly, export specialists emphasize the importance of carefully selecting a local partner to avoid any unforeseen complications.
However, local support within France is also key to driving greater international growth for SMEs. This involves working within a network, as well as fostering stronger relationships with one’s bank. *Access to financing could be rapidly improved. Generally, French banks find it easier to do business with large corporations. This stands in contrast to German regional banks, which possess deep expertise regarding the large SMEs within their respective federal states.*“, notes Béatrice Collin.
