As per a recent survey conducted by the Strategic Banking Corporation of Ireland (SBCI), nearly two-thirds of Irish small and medium-sized firms (SMEs) have either lowered their dependence on or halted their dealings with British suppliers in the wake of Brexit. Over one-third have stopped selling their products to British customers.
The survey revealed that 61% of the participating SMEs had scaled back or ceased their associations with UK-based suppliers, with 48% curtailing their involvement and 13% cutting ties altogether. Moreover, 34% of Irish SMEs have either limited or stopped selling products to customers in the UK, with 26% reducing their sales and 8% discontinuing them completely.
Brexit has thrown up bureaucratic hurdles and extra paperwork for trade between these jurisdictions, prompting many SMEs to reconsider sourcing raw materials from the UK or selling their goods to the UK market. These changes are labelled by the SBCI as “severe shifts in Irish SME’s trading patterns with the UK post-Brexit”.
Earlier this year, a sample of 165 companies participated in a survey. The insights pointed out that post-Brexit, 19% of SMEs have increased their reliance on suppliers based in other EU nations, whereas a similar proportion have started sourcing from EU-based suppliers for the first time.
However, Brexit has left no mark on the commercial relations of British suppliers or customers for a solitary 24% of respondents.
In a broader context, the local SMEs have pointed out the lack of skilled talent, elevated costs of energy and transportation, and difficulties in securing finance as their greatest stumbling blocks.
According to the survey, 59% of these SMEs believe that attracting skilled labour is among the biggest risks currently faced by their business, while 48% listed transportation and energy costs as potential threats. Issues regarding access to finance was flagged as a concern by 44%.
Interestingly, the survey unveiled a strong inclination amongst Irish SMEs toward eco-friendly schemas, favouring energy-saving investments like solar panels and energy-efficient lights.
The SBCI’s chief executive, June Butler, commented on the informative findings of our research which provides a clear depiction of the main threats Irish SMEs are encountering, as well as their willingness to fund green technology and adopt more eco-friendly business strategies. She outlined that the SBCI has thus far facilitated more than €4 billion in affordable, adaptable finance to over 60,000 Irish SMEs. Butler signalled the institution’s eagerness to ensure that the services they offer align with the requirements and desires of SMEs.
According to Butler, the SBCI has orchestrated customised financing schemes to aid SMEs in tackling their significant challenges, providing them a foothold for expansion, job generation, and enhancing their sustainability. She assured that they will persist in maintaining close coordination with SMEs to render even more advantageous funding choices in their future endeavours.