When it comes to operating SMEs in Ireland, there are a number of common hurdles no matter what the industry. Yes, the economy is in growth, but as most small-to-medium-sized business owners can tell you, this doesn’t automatically translate to high profits. Inflated rents; increased cost of living; teamed with a nominal increase in the average industrial wage over the past few years have taken their toll on the finances of many households. This means potential clients or customers might not have the level of expendable income needed to sustain a viable business.
Conversely, the expenditures required when managing a company have skyrocketed; costs relating to insurances, rent, overheads, and regulations compliance have all increased considerably. This, coupled with the advent of online shopping, and the number of multinationals setting up across the country, can eat away at the profits of a smaller, local business. Many SME owners assert that the government supports allocated to encouraging indigenous industry are dwarfed when comparing the benefits, tax breaks and resources designated to attracting international corporate goliaths.
According to a recent survey conducted by Biz Expo, there are nine major issues facing most SMEs. This questionnaire went out to just under 2000 business owners, managers and service providers in the field who previously attended the Dublin-based, business-to-business trade show. Those questioned worked across a wealth of companies, which included tech platforms, craft manufactures, financial firms, training providers, food franchises, law firms, marketing companies, IT providers, video production companies, and recruitment firms.
The Top Issues Facing SMEs (Ranked in Order):
Many businesses reported difficulty in building a loyal customer base and establishing even, regular profits,
Managers cited that hiring and retaining good workers was a struggle; sales staff and employees with highly-coveted qualifications or skillsets were being poached by competitors or larger multinationals.
Dealing with the competition has proved to be difficult for businesses across a number of industries. SMEs reported having their clients poached, or even their costs undercut by other companies in their respective field
The survey revealed that managers are being stretched thin when it comes to time management. Overseeing an SME can be a busy, consuming endeavour. Many business owners admitted to finding it difficult to take time off, with one owner even struggling to take maternity leave.
5. Regulations and Insurance
In recent years, there have been many regulations implemented by the government in terms of compliance, employee laws as well as health and safety. Although important for the wellbeing of customers and workers, these can be costly and time-consuming to implement, especially for businesses with limited resources.
4. Planning, Strategy, and Growth
When resources are stretched across the board, it is easy for someone in a smaller company to find their day-to-day obligations overtaking their working schedule. Many respondents admitted they found it difficult to budget the time and capital towards developing a vital future strategy for their business.
A large number of the business owners questioned cited marketing as real concern. Finding the right clients and negotiating social media were reported as some of the main issues for companies.
Brexit is taking a huge toll on Irish businesses. Many SMEs reported that the uncertainty caused by Britain’s vote to leave the EU has resulted in issues securing funding, and has also lead to cautious spending in various targeted markets.
1. Cash Flow
The number one issue facing the majority of SMEs in the country is irregularity when it comes to cash flow and the difficulties this can incur. Whether you are managing a new or established business, problems in this area can affect your reputation, profitability, as well as your finance management.
One manager, who has asked not to be named, shared her frustrations after her previous company went into liquidation, ‘We were slowly recovering from legacy issues after the 2008 bust and were rebuilding the business from the ground up. However problems with cash flow seriously hindered not only our growth but our ability to function as a viable business. There’s more and more money in the country, but this doesn’t filter down to everyone. Our debtors were in the same situation, and when one of our clients were unable to fulfil on their fiscal obligation, this has a knock on effect that eroded our ability to balance our books over time. One day, after over twenty years of operating in Dublin, a substantial bill came in that we couldn’t pay and we were forced to close our doors forever.’
About Biz Expo
This survey was sent out in December 2018 to previous attendees of Biz Expo, a large conference and networking event. Biz Expo has been running since 2011 and this year’s trade show takes place Citywest Hotel & Convention Centre on Thursday, 6th June. BCS Recruitment, Cisco, Directorwealth, Dublin Gazette, IE Domain Registry, Big Red Box, Radio Nova, Printroom, HRLocker and Whatswhat.ie are the official Biz Expo sponsors. Admission is free to business owners and professionals and there will be workshops, networking and main stage presentations from industry experts across a number of fields including Digital Marketing, GDPR & Data Protection, Cyber Security. You can register your spot here.