Trade activity remains resilient in face of growing challenges
- 41% of businesses continuing to grow
- Cross-border trading increases a business’s probability of growing rapidly by over 60%
- 54% of SMEs say reporting issues with rising costs of overheads
- 41% of larger firms (50+ employees) reporting skills shortages within their sector
- 42% of exporters reporting a negative ‘Brexit’ impact on sales
The latest InterTradeIreland Business Monitor (Q3 2018) shows that trade has remained resilient over the past quarter reflected in the number of companies continuing to grow (41%).
This quarter’s Business Monitor again highlights the higher growth performance of exporters and cross-border traders, almost half of all firms that trade across the border are growing, with 30% experiencing rapid growth in sales, compared to just 18% that do not export.
Aidan Gough InterTradeIreland’s Designated Officer and Director of Strategy and Policy says “The figures from our latest Business Monitor are supported by InterTradeIreland’s latest research1 which shows that SMEs that export, including cross-border traders have significantly better outcomes across a range of key indicators including turnover, employment and productivity. Goods firms exporting across the border have 9% higher levels of productivity than firms that don’t export beyond their local market, moreover turnover is almost 100% higher and employment is almost doubled. Expanding participation in cross-border trading makes an important contribution to the individual performance of the firm and to the wider economy.”
There are a number of challenges on the rise
In the context of this positive sales backdrop, businesses across the board are facing a number of challenges. Top among these is the rising costs of overheads with 54% of SMEs saying it is their biggest challenge. This jumps to 64% for manufacturing and 67% for the leisure and catering sector. Rising energy costs are also a significant factor for firms with 51% reporting it as an issue.
Skill shortages is an issue that is being felt more specifically by certain types of businesses and certain sectors. While over 1 in 5 (26%) of businesses are experiencing difficulty recruiting, this rises to 36% for large businesses and 29% and 31% in the construction and professional services sector respectively. 41% of larger firms (50+ employees) say there are skills shortages within their sector.
Brexit continues to be a significant issue, particularly for exporters as 42% report it has already had a negative impact on sales and 38% cite that it has impacted negatively on investment decision making within their firm. There have been additional negative impacts on supply chains and logistics for more than a quarter of exporters to date.
InterTradeIreland has a Brexit advisory service that SMEs can avail of. This includes a “Start to plan” voucher, which enables firms to access professional advice with a value of up to €2250/£2000 to analyse the challenges and opportunities within their business that Brexit poses.