Business

Half of Irish firms are in distress with Covid-19 the major issue - InterTradeIreland survey

Almost half the businesses surveyed by InterTradeIreland said they were contracting, winding down or surviving at all costs at the end of 2020.
Almost half the businesses surveyed by InterTradeIreland said they were contracting, winding down or surviving at all costs at the end of 2020. Almost half the businesses surveyed by InterTradeIreland said they were contracting, winding down or surviving at all costs at the end of 2020.

HALF of all Irish businesses are in survival mode, with Covid-19 the major issue, according to a new survey from InterTradeIreland (ITI).

The cross-border body’s latest business monitor found that the number of firms contracting, winding down or surviving at all costs went from 13 per cent at the end of 2019 to around 50 per cent in the fourth quarter (Q4) of 2020.

Some 61 per cent of businesses cited the coronavirus pandemic as the main source of their woes, compared to just five per cent which said Brexit a lone had hit operations.

Almost one-in-three firms however said that both developments are playing a role in their current business concerns.

Although the report is based on the experiences of 750 business managers across the island during the final three months of 2020, ITI conducted the survey in January and February 2021, after the implementation of the new Brexit arrangements and the Irish protocol.

ITI’s assistant director of strategy and policy, Kerry Curran said, “Businesses are currently in the unenviable position of facing the dual tests of the pandemic and the end of the Brexit transition period.

“While no sector is immune from the ongoing challenges, the data reveals that cross border traders and exporters are beginning to see sales losses moving in the right direction.”

The monitor showed 36 per cent of businesses surveyed import and 25 per cent export within the island and the EU.

Some 31 per cent import from Britain, with 13 per cent sending goods back across the Irish Sea.

“Supply chains have become very integrated in recent years and we recognise that for many firms the disruption to supply chains has created uncertainty and additional demands on time and resources,” said Ms Curran.

The survey also said 58 per cent of businesses continue to struggle with reduction in demand for goods and services, low business and consumer confidence and the subsequent impact on their cash flow. Manufacturing and leisure sectors have been particularly impacted.

Looking ahead, 76 per cent of believe Covid-19 will continue to have a negative impact on their operations over the next 12 months.

Less than half believe Brexit will have a negative impact, with 43 per cent citing Brexit as having no impact whatsoever.

“While the data does make for stark reading, and businesses are understandably focused on directing resources to survive these once in a lifetime challenges, I would encourage firms to make best use of available supports,” added the ITI strategy assistant director.