More than a third (37%) of businesses in Ireland say they are growing, while half (53%) are stable and six in 10 confirm they are profitable.
But challenges around costs and access to people and skills persist, while cash flow is becoming a bigger issue, contributing to an overall sense of uncertainty and potentially dampening the appetite for investment.
The findings are contained in InterTradeIreland’s latest All-Island Business Monitor, which takes the temperature of 750 small business owner/managers across the island.
The survey shows that sales performance, which is the nuts and bolts of doing business, remains positive across the wider business economy. Three in 10 (30%) reported increased sales this quarter and over a third of all firms surveyed are expecting sales to grow over the next six months.
The biggest challenges for businesses remain the high costs of energy and other overheads which have their roots in wider economic and geopolitical issues.
InterTradeIreland’s director of strategy Martin Robinson says: “There are also certain concerns that are coming into sharper focus in the third quarter. While these are not yet causing sleepless nights for business owners, they have increased in importance.
“Emerging issues reported include business and consumer confidence, cash flow, access to finance and demand for goods and services. Together, these could subdue investment intentions.”
When asked about investment, seven out of 10 businesses said they had no plans to increase employee numbers, upgrade new plant or equipment or invest in IT over the next 12 months. One in four SMEs reported that the biggest barrier to growth is actually finding the time to focus on it.
The survey also shows that access to skills is a real pinch point for firms. Businesses are indicating that not having enough people is putting them and their existing staff under pressure. Both these factors combined mean that there’s limited room for business owners to think strategically about their growth plans.
Martin added: “Increasingly we would encourage firms to seek support from agencies across the island, who can work with them to embrace innovation to plug skills gaps and improve productivity. It may take time up front, but in the longer run it will accelerate your business growth.”
Business consultant Garrett Harty, who works with companies in Co Antrim and often directs them to InterTradeIreland for assistance, says: “These findings don’t surprise me. Many of the business managers I work with are very time-poor and are looking for practical solutions to solve challenges around productivity or smarter ways to bring more people into the business that can focus on sales.”
The survey also asked businesses how they have adapted to the trading conditions post-Brexit. Encouragingly, there are signs of improving knowledge of the Windsor Framework and its requirements for businesses.
In September’s All-Island Business Monitor, almost half (49%) of those who indicated they remain impacted by the UK’s exit from the EU said they had no knowledge about the requirements of the Windsor Framework, but this percentage has now dropped to just over a third.
Economy minister Conor Murphy said: “I’m pleased that awareness around the Windsor Framework is increasing, and I encourage any firms with questions or who need more information to contact InterTradeIreland’s Trade Hub to be well placed to take advantage of the huge benefits that both dual market access and the all-Ireland market provides.
“Earlier this year, to help address some of the skills issues raised by employers, I announced a new Skills Fund of up to £12 million, which will support important skills initiatives, including a new Skill Up programme, developing our childcare workforce and growing the apprenticeship system.”
