Access to funding for Irish SMEs has become more difficult over the last couple of years and is a serious barrier for new business.
In a survey carried out by Big Red Cloud of over 250 business owners/managers throughout Ireland, respondents were asked what they believe are the primary challenges facing entrepreneurs and hurdles already-established SMEs might face.
The software providers then compared the findings with the same Big Red Cloud survey conducted two years ago.
Marc O’Dwyer, CEO of Big Red Cloud, said: “Sourcing the funds to propel your business forward is always a challenge, but it’s notable that in the last two years, more business owners have begun to identify this as an even greater problem. One might have assumed that credit issues would not be as pronounced, with the economy improving as it has been. Conversely, however, we see that difficulties around taxation have fallen down the pecking order when it comes to hurdles that both start-ups and SMEs have to surmount.”
Comparing figures from 2018 and two years ago, the results showed what respondents had as their number-one challenges for start-ups and established SMEs.
Start-ups’ number-one challenges: access to credit (56% in 2018; 49% in 2016), regulatory and compliance issues (20% in 2018; 20% in 2016), lack of government support (10% in 2018; 12% in 2016), taxation (7% in 2018; 14% in 2016) and staffing (7% in 2018; 5% in 2016).
Established SMEs’ number-one challenges: access to credit (29% in 2018; 23% in 2016), regulatory and compliance issues (27% in 2018; 25% in 2016), lack of government support (16% in 2018; 15% in 2016), taxation (15% in 2018; 26% in 2016) and staffing (13% in 2018; 11% in 2016).
Marc O’Dwyer went on to say: “Figures from the Central Statistics Office (CSO) report that there are 248,344 small and medium enterprises active in Ireland, employing some 968,881 people. The contribution these businesses make to our economy is enormous. So, we, and more specifically our government, need to ensure that the supports and structures that will allow these businesses to not only survive, but thrive, are in place.
“As a country we are doing well. Analysis by monitors at Vision-net found that 22,354 new companies were registered in Ireland last year, a figure up by just over 6% on 2016 (21,018).
“An average 61 new companies were formed every day in Ireland last year, making it the best year ever for new business formation. However, it also reported an average of three insolvencies a day in 2017, with 1,018 company insolvencies recorded in total, a 3% increase on 2016.
“We need to nurture our emerging business sector. There are thousands of people out there who put their necks on the line every year in the hope of starting a commercial enterprise, that will not only provide them with income, but will also employ people in their region, and support other indigenous businesses. If supporting our established SMEs is a natural step in good fiscal planning, then encouraging our start-ups is the next piece of the puzzle.”