- Half of small businesses expect export revenues to increase

- New study reveals mixed confidence in U.S. economic conditions

- 39% of companies surveyed plan to reduce staff numbers

ENGLEWOOD, Colo. - September 8, 2014 - A new national survey of over 2,100 small and medium-sized businesses (SMBs), conducted by Western Union Business Solutions, a division of the Western Union Company (NYSE:WU), revealed a growing appetite for exports from U.S. companies engaged in international trade.

The independent research, which surveyed SMBs that import/export, found that U.S. small businesses are increasing their international trade activity:

· The average U.S. SMB trades with four or five countries and 45% of respondents said that this number has increased in the last 12 months;

· Exports currently generate an average of 17.5% of small business revenue; 41% of SMBs surveyed said they had increased export revenues by an average of 8% over the last year;

· 47% expect the proportion of business revenue driven by exports to rise by an average of 9% in the coming year, driven principally by trade with emerging markets and BRIC countries.

"We are seeing that U.S. small businesses are trading with a handful of countries and have an appetite to expand to more markets," Jonathan Rees, North American Managing Director, Western Union Business Solutions, remarked. "While export activity is still dominated by Western countries, China and emerging markets generally represent a large opportunity that SMBs are clearly looking to pursue."

Fifty-four percent of U.S. small businesses believe that emerging markets and BRIC countries will drive their business' future export activity. Additionally:

· Most SMBs import from China (43%), other parts of Asia (39%), Canada (38%), Europe (33%), Latin and South America (20%), Australasia (13%), or Brazil (10%);

· Primary export markets are Canada (42%), Europe (37%), China (32%), Australasia (31%), and other parts of Asia (30%).

This push for increased international trade activity comes against a mixed outlook for the U.S. economy, despite recently reported figures that the U.S. economy grew by 4.2% in the second quarter:

· Only 58% of SMBs expressed confidence in the U.S. economy;

· 52% believe the domestic economy has stayed the same in the last 12 months, 18% think it has improved and 30% think it has deteriorated;

· 35% of respondents believe the cost of credit has decreased in the last 6-12 months, with 63% seeing no change;

· Businesses were equally split on growth, with 51% of companies expecting overall revenue growth compared to 49% expecting no or negative growth.

However, while 46% of respondents plan to invest more in their business in the coming 6 months, 39% plan on reducing headcount.

"SMBs are vital to the U.S. economy," said Jonathan Rees. "As the U.S. continues on the path of economic recovery, it is important to get tailored support to these companies that helps them manage the complexities of growing internationally and enables them to be as competitive as possible on a global level."

As U.S. SMBs increase their international trade activity, they become more exposed to foreign exchange fluctuations; only 30% of SMBs fix the cost of their international invoices in advance, leaving the majority to market movements and uncertain cash flow. Moreover:

· 35% of SMBs borrow to cover additional costs when foreign payables run higher than planned;

· 26% use working capital;

· 21% dip into their reserves or decrease their profit margins.

"Payment and cross-border cash flow challenges will become more prevalent as companies continue to look abroad for growth," Rees continued. "M any SMBs report uncertainty about the actual cost of non-U.S. invoices, which puts budgets and profit margins at risk."

"However, it is a simple process for SMBs to secure a hedging facility to cover the cost of international invoices, which is a better option than taking on additional bank credit or dipping into working capital. We work with thousands of U.S. small businesses to increase their visibility over foreign exchange exposures and streamline their cash flow processes. This ensures they are not taking on additional credit burden unnecessarily and helps improve the health of their overall business."

The survey was conducted in June 2014 by East & Partners and included 2,197 U.S. companies engaged in international trade. Of the companies surveyed, nearly half (43%) of the participants survey are business owners or CEOs, while the others are either CFOs, finance directors, or treasurers. Participating companies hailed from a variety of industry sectors, including property and business services (13%), retail (11%), construction (10%), manufacturing (9%), transport and storage (8%), and wholesale (5%). About 43% of survey respondents are from businesses based in New York and other parts of the East Coast, while 16% are California-based, and 9% from the Midwest. The margin of error associated with this level of reporting is +/- 2.0% at a 95% confidence level.

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About Western Union Business Solutions

Western Union Business Solutions  enables companies of all sizes to send and receive international payments and manage global cash flow, creating unique solutions tailored to suit their individual needs. It is a business unit of the Western Union Company (NYSE: WU), a leading nonbank provider of cross border payments, which operates its Business Solutions services through locally licensed affiliates in over 30 countries.  Clients are supported by a network of trading offices, strategic banking relationships and a global clearing network and can send cross-border foreign exchange payments in more than 135 currencies. 

About Western Union

The Western Union Company (NYSE: WU) is a leader in global payment services. Together with its Vigo, Orlandi Valuta, Pago Facil and Western Union Business Solutions branded payment services, Western Union provides consumers and businesses with fast, reliable and convenient ways to send and receive money around the world, to send payments and to purchase money orders. As of June 30, 2014, the Western Union, Vigo and Orlandi Valuta branded services were offered through a combined network of over 500,000 agent locations in 200 countries and territories and over 100,000 ATMs. In 2013, The Western Union Company completed 242 million consumer-to-consumer transactions worldwide, moving $82 billion of principal between consumers, and 459 million business payments.www.WesternUnion.com

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