Small and medium sized enterprise SMEs play an important role in the Irish economy and contribute substantially to income, output and employment. However, the recent global financial crisis created a particularly tough climate for SMEs with a reduction in demand for goods and services. SMEs make a huge contribution to GDP and employment.
The global financial crisis of 2008 however, created new challenges for SMEs. Findings are mixed as to how effectively businesses have recovered from the crisis and coped with recessionary climates. The impact of the financial crisis in the economic downturn that it entailed was substantial. Many companies, SMEs included suffered negative repercussions such as reduced revenue or were even forced to close down. So SMEs are now operating in a new business environment.
Internationalisation is important for the competitiveness of enterprises of all sizes, particularly for SMEs. Recent reports show that SMEs make an important contribution to the national GDP and employment. Governments have implemented a range of policies to support SMEs. Efforts have been made to support the internalisation of SMEs. SMEs tend to internationalise in markets close to home.
SMEs rely on traditional funding sources for international activity. All the evidence reviewed in recent reports for both previous studies and newly conducted research indicate that SMEs are important for economic success, particularly when they become active on the international stage.
Irish SMEs and family businesses are showing continued resilience while looking to address the challenges of the new norm. There is no doubt that the recession has hit the Irish family business sector harder than their global counterparts. However, they have adapted their business models and are now looking to the future. Many SME owners rely on their advisors to help them navigate the maize.
While some ten years ago the challenge was succession, the ability to recruit and retain key people has emerged as a new area now to be tackled. This is largely in response to strong growth ambitions. Irish family businesses are now looking to expand and some of this growth will be delivered through exploring international markets. The need for continued innovation is also cited as a key driver in order to move forward. It is good to see pro-business initiatives like the CPA Ireland new finance app for business owners allowing them to track the performance of their company across a number of variables.
Family businesses play a significant role in how our economy performs and it is important going forward that these businesses continue to operate at a competitive advantage. Recent research highlights that family businesses take decisions for the long term and are committed to employment in the local economy. In 2012 according to recent reports over one third of Irish family businesses suffered sales reductions over the twelve months compared to just a fifth for their global counterparts.
Reports also show that in the SME Irish family business sector, over 90% of Irish family businesses surveyed reported to feeling a sense of responsibility in supporting employment in their area.
SMEs still struggle when it comes to developing internationally, lack of credit and debt is a major issue hampering the sustainability and growth of many businesses. However, a significant number of SMEs continue to thrive despite the tough economic conditions. They are our business heroes. Their growth and sustainability will be the key to Ireland’s economic recovery and it is vital that they get the support and services that they need according to CPA Ireland President Joe Aherne.
We work with Entrepreneurs, SME business owners in the area of SME business advisory and reports like the CPA Ireland Entrepreneurship report make for some very interesting reading.
The CPA Ireland Entrepreneurship report can be downloaded, free of charge and contains some very useful information. The second CPA Ireland Entrepreneurship report offers further evidence of that resilience and will hopefully assist the Government and the other stake holders involved in supporting entrepreneurship in making the policy and other decisions required to maintain the improvement in the environment for enterprise and entrepreneurship in Ireland.
There are some very hard working entrepreneurs with great ideas that just need some help and support to take risks which will in turn create employment.
Another pro business resource clients find useful is the CPA Ireland Taking Charge of your Business which is a collection of webinars on very relevant topics again free to SMEs to download .
CPA Ireland has compiled a series of webinars from a panel of experts providing unique insight to business owners. The short twenty minute presentations are free to access and cover a variety of topics including Cash Flow Management, Recruitment, Marketing, HR and Risk.
CPA will continue to add to this resource in 2013.
Seminars may be accessed via the list below:
Items contained in the report for example show that amongst the most encouraging overall findings in the Entrepreneurship report is a broad agreement that the climate for entrepreneurship in Ireland is not only positive, but it has actually improved over the last two years.
There was a feeling that many Irish business people had now recovered from the initial shock of the banking crash and its accompanying economic crisis and are now much more in a mood just to get on with things. This in turn is feeding in to improvements in the overall climate for entrepreneurship in Ireland.
Hopefully 2014 will see the climate improve for SMEs, family business and entrepreneurship in Ireland and business owners will adopt innovation into their business.
Fitzgerald and Partners are SME Business Advisory, Accountants and Auditors located in Kinsale in Cork