InterTradeIreland’s latest quarterly Business Monitor (April – June 2015) shows that 83% of businesses are stable or growing but that the recovery is driven by just 40% of firms with manufacturing and business service firms the two biggest growth sectors.
While businesses continue to experience recovery across the island, it is at a slower pace than in recent quarters, where in the first quarter of 2015, 88% of businesses were stable or growing.
Over the last few quarters, businesses in Ireland were clearly outperforming Northern Ireland firms but figures from the Q2 report indicated more of a convergence between the two jurisdictions, with 40% of firms in Ireland in growth mode compared to 36% of businesses in Northern Ireland.
This quarter the InterTradeIreland Business Monitor specifically focussed on the characteristics that differentiate rapidly growing firms from the rest. Commenting on the report, Aidan Gough, Strategy and Policy director, InterTradeIreland said: “We took the opportunity with this quarter’s report to look at what type of firms are driving growth and what they are doing differently or better. Although moderate to rapid growth was found in businesses of all sizes, types and sectors, it was especially prevalent amongst larger firms. In particular, the report confirmed that those firms that are exporting and those who take a more strategic approach to growth, such as having a formal business plan in place, are more successful.”
The report also found that growth firms are much more likely to have innovated across all areas of the business in the past three years. For example, three-quarters of moderate to rapid growth firms introduced new or improved products or services and 62% implemented new processes, machinery, equipment or tools.
Gough added: “This finding confirms results from other reports that we have carried out which show that businesses that are innovating and doing things differently are three times more likely to grow. Excellence in innovation processes, culture and skills is at the core of rapidly growing firms with these businesses more likely to have dedicated R&D staff and a more formal process in place for managing innovation than non-growth firms.
According to Gough: “53% of non-growth firms share this ambition to grow but need the necessary support agencies, such as InterTradeIreland, to help them avail of cross border opportunities that will help them to overcome specific capability deficiencies in the areas the survey has identified and translate that ambition into a growth reality.”