Mid-market leaders keep expansion appetite

Kreston Global has found that mid market companies remain optimistic about international expansion despite rising concern over tariffs, regulation, and geopolitical instability.

The latest Interpreneur Report is based on a survey of 1,100 international entrepreneurs running businesses with revenue from £10m to £300m across 11 countries. All respondents had successfully expanded into international markets.

The research found that respondents gave the current climate for international expansion an average score of 8.2 out of 10. That optimism sits alongside significant concern about external pressure. Geopolitical instability was cited by 45% of respondents, increasing tariffs by 40%, and changes to regulation and compliance by 37%.

The report also identifies the factors that make markets attractive to SMEs looking to expand internationally. Favourable trade agreements were the leading factor, cited by 48% and up 14% since 2024. Favourable tax policies were cited by 39%, up 18%, while transparent regulation was cited by 36%, up 28%.

The findings suggest that mid market companies are still pursuing cross border growth, but with a stronger preference for predictable rules, lower friction, and clearer market entry conditions. Expansion appetite has not disappeared, but it has become more selective.

That shift reflects the environment facing internationally active companies. Tariff risk, supply disruption, sanctions, currency volatility, political uncertainty, tax complexity, and regulatory divergence all affect where businesses choose to sell, hire, source, invest, and establish subsidiaries.

Mid market companies can feel those pressures sharply. They may have enough ambition and product market fit to expand internationally, but fewer internal resources than large multinationals to absorb legal, tax, customs, compliance, and operational complexity. A policy shift in one market can absorb management time, increase advisory costs, and slow growth plans.

Kreston’s data also points to the growing importance of trade policy in business decision making. Favourable trade agreements have become the most commonly cited attractiveness factor, indicating that market opportunity alone is not enough. Companies want access terms that make expansion commercially manageable.

Operational infrastructure is now a central part of international growth. Huboo’s launch of a Dallas fulfilment operation, designed to support brands selling into North America, showed how expansion increasingly depends on fulfilment, data visibility, payment systems, customs, returns, and local market presence.

The report also illustrates the role of tax and regulation in competitiveness. A favourable tax regime can make a market more attractive, but transparent regulation may be just as valuable. Businesses can plan for rules they understand. Unclear, unpredictable, or inconsistent regulation increases execution risk and can make a larger market less attractive than a smaller but more stable one.

Geopolitical risk is now part of mainstream expansion planning. Companies entering new markets must consider customer demand alongside sanctions exposure, supply routes, political alignment, data rules, employment obligations, and reputational risk. Scenario planning that once sat with large corporate strategy teams is becoming routine in the mid market.

The findings also raise a leadership challenge. International expansion places pressure on management teams that may already be stretched by domestic growth. Leaders need to build local knowledge, trusted advisory relationships, governance structures, finance controls, cultural understanding, and compliance oversight before expansion creates unmanaged risk.

The term “interpreneur” captures that operating reality. These are not simply exporters. They are companies building international footprints, managing cross border activity, and adapting operating models across jurisdictions. That requires a different level of organisational maturity from one off sales into overseas markets.

Technology can reduce some barriers, although it does not remove the need for judgement. Digital sales channels, cloud platforms, ecommerce infrastructure, international payments, AI translation, and remote working tools make cross border activity easier to start. Tax presence, local employment law, customer service expectations, supply reliability, and regulatory registration still need careful management.

The report also has relevance for UK economic policy. Mid market companies are often large enough to scale exports and create skilled jobs, but not always prominent enough in policy debates dominated by start ups and major corporates. Support around trade agreements, export finance, market intelligence, tax clarity, and regulatory guidance can materially affect their willingness to expand.

Kreston’s findings show resilience, but not complacency. The opportunity for mid market companies remains real, particularly where products, services, and specialist capabilities travel well. The barriers are becoming more institutional. International expansion in 2026 depends as much on rules, relationships, and risk management as it does on sales ambition.