GENERAL INTRODUCTION :

United Kingdom has an area of 244,100 sq.km, (94,250 sq. miles) with a population of 57 million people. It has relatively a high population density. It ranks fifteenth in world in terms of population. The separate traditions and cultures of England, Wales, Scotland and Northern Ireland, its four component parts, have been added to over the centuries by these of immigrants (Irish, Jews, French Huguenots, for example) and political refugees from Europe who have settled in United Kingdom. More recently people from the Caribbean and the South Asian subcontinent, Cypriots, Italians, Chinese and others have contributed to the multi racial nature of the British society. Legislation is designed to help foster equal rights and equality of opportunity for all citizens, and the criminal law on incitement to racial hatred has been strengthened.

ECONOMY:

United Kingdom has an open economy, in which international trade plays a vital part. About one-quarter of its gross domestic product (GDP) comes from the export of goods and services, a high share among major economies. Private enterprise accounts for three quarters of GDP and a similar proportion of total employment. Since 1980 the annual rate of inflation has fallen from about 21% to some 6% in late autumn 1988, and this has been accompanied by a notable rise in living standards.

While manufacturing continues to play a vital role in economy, recent decades have seen a faster growth in the services sector in response to rising living standards. United Kingdom is a leading manufacturer and exporter, especially of mechanical equipment, electrical and electronic goods, and chemicals. Productivity has also grown sharply in long established industries like metal manufacturing and vehicle building where there has been extensive modernization. About 77% of visible exports consist of manufacturers or semi-manufactures. Microelectronics are increasingly used in production processes. Computer-aided design facilities, for example, have taken up by about 60% of all engineering plants.

United Kingdom is the worlds ninth largest steel producer (by volume). In addition to its large output of non-ferrous metals, United Kingdom is also a major producer of specialized alloys used by the aerospace, electronic, petrochemical and other industries. Other mineral products include glass (especially float glass, which was developed in United Kingdom), bricks, cement and ceramics. United Kingdom is the worlds leading manufacturer of fine bone china, much of it exported, and the biggest exporter of China clay. Mechanical engineering is an important source of export earnings. Major products include process plant for large-scale industries such as oil refining and nuclear power generation.

United Kingdom is the Western worlds largest producer of agricultural tractors, many of which are exported. It is also an important manufacturer of railway and motor vehicles. The British aerospace industry is the third largest in the world, its products including civil and military aircraft and satellites. United Kingdom is one of the three largest markets in Western Europe for data processing equipment, and expenditure on data processing as a proportion of GDP is the highest. Over 70% of British manufacturing businesses now use computers to assist production.

The Chemical industry is the third largest in Europe and the fourth largest in the non-communist world. Nearly half of its production is exported. Pharmaceuticals are responsible for about a third of the sector's overseas trade surplus.

Textiles and clothing with almost 9% of manufacturing employment, make a substantial contribution to the British economy. The clothing industry, one of the largest in Europe, meets about two thirds of domestic demand. The woolen industry is one of the worlds largest and United Kingdom is a leading producer of woven carpets. Footwear factories supply 36% of the British market and one-third of leather production is exported. Other manufacturing industries include food and drink, timber and furniture, printing and publishing, paper and board, and rubber. Security printers of banknotes and postage stamps are important exporters. Jewellery, gold and silverware have a strong craft tradition.

IMPORTING ENVIRONMENT :

United Kingdom supports an open world trading system and further trade liberalization. Almost 12% of United Kingdom's imports come from developing countries. Lome Convention signatories are allowed duty free access to the Community for industrial and most agricultural exports. Preferential treatment in trade is accorded to overseas countries having special links, with the community, especially the 66 developing countries in Africa, the Caribbean and the Pacific which are signatories of the Lome Convention.

Imports into U.K. originate mainly in the Far East and other Asian countries. Hong Kong and China are the two leading Extra- EC suppliers. The main areas of interest for imports from third countries cover low and medium priced commodities. However, high fashion or more structured garments still tend to be imported from Western countries where international fashion trends are set.

In the recent past there has been a very deep recession in the U.K. and this has resulted in a declining trend in all kinds of shipments. The recession has also forced many major buyers to rationalize their operations in order to remain profitable.

Just-in-Time buying policies are increasingly being adopted to meet the needs of major retailers. Holding huge stocks of commodities is now thing of the past. Monitoring of sales performance is achieved through the widespread use of Electronic Point of Sale Systems (EPOS) at the retail level. The new efficiency within the retail sector inevitably puts increased pressure on suppliers, who in turn must be able to determine manufacturing and management efficiency in order to meet shorter lead times and more demanding quality standards.

For the majority of the larger buyers, flexibility and quick response are now the two key factors influencing decisions. Orders of high fashion merchandise in particular, are increasingly being placed nearer to home. The market is segmented into lower value products for mass market consumption, the bulk of which is sourced from third country suppliers. The upper-middle segment of the market is categorised by brand-name products, or more up-market lines that sell under department store own-labels. Imported commodities for Mail order or the major department or chain stores is handled almost exclusively by large importing companies. The latter are appointed by the major retail companies to source their specific requirements. Typically, they specialise in supplying certain categories of apparel. Traditionally, the majority of the major retailers have had their own in-house design departments to produce the bulk of seasonal requirements which are then supplemented by complementary collections put together by the importer's own design studios.

Importing wholesalers and agents who sell on a commission basis mainly cater for the needs of the independent retail sector as well as some of the smaller more specialised mail order catalogues. The majority focus on lower priced apparel targeted at the mass market consumer, others specialise in specific quality niche categories such as designer knitwear, silk dresses or brand-name children's wear.

Competition in the market is staggering. This places the utmost importance on commitment, distribution, design and pricing. It also reinforces the need for developing highly competitive market entry strategies based upon products which should be targeted at well researched segments of the market. Retailers are giving major consideration to inventory levels and replenishment needs of stock and will continue to stipulate shorter and more rigorous in-store delivery time. New suppliers must be able to offer a significant competitive advantage over existing suppliers if success in generating sales orders is to be achieved.
The following organisations can offer advice on commercial information :

De CTA – The developing countries Trade Agency,
Bank House, 1-7 Sutton Court Road
SUTTON, Surrey SMI 4SP.
Tel :(4481) 6433311
Fax: (4481) 643 8030
Telex : 94 8116 caphco g

2. Association of British Chambers of Commerce
9, Tufton Street, LONDON SWIP 3QB.
Tel: (071) 222 1555
Fax: (071) 799 2202