The Irish business confidence report: 2024
As a small business owner or an important decision maker within a small Irish business, we’re sure you know just how tricky it’s been trying to safely navigate the Irish market in recent years, especially with the lingering impact of the 2020 pandemic and the recent recession experienced by Ireland and the UK at the end of 2023.
Indeed, running a small business effectively can be challenging at the best of times, but with ongoing political and civil events around the world helping to spark Ireland’s own cost of living crisis, it’s safe to say that budgets have been tight for just about everyone.
However, the good news is that things appear to be on the mend, with consumer confidence, and more relevant to our article, business confidence, currently set to follow a rising trend.
But is this rise in Irish business confidence just a short-term bonus related to the recent reduction in inflation, or do local business owners finally feel like the economy has stabilised enough for them to once again consider long-term growth as a viable option?
To find out, we conducted a survey of 250 small Irish businesses and small business decision-makers to see how confident they feel about the state of the Irish market in the summer of 2024, and whether or not they expect future challenges to substantially impact the growth of their business.
Take a look below to see exactly what we discovered.
What are the biggest challenges Irish businesses are facing in 2024?
Perhaps to no one’s surprise, the biggest concern facing most small Irish businesses in 2024 is the potential for inflation to rise once again or for the economy to slip back into recession – something that was flagged by 44.2% of business owners who responded to our survey.
On top of this, a further 38.65% highlighted their concern around the risk of energy bills and essential business investments increasing in price towards the end of the year, while a further 38.25% were also seriously concerned about whether or not their business would be capable of carrying out a digital transformation and go online.
And concerns don’t stop there, with another 37.85% of business owners being worried about customer retention and 37.05% having fears about competitors offering cheaper alternatives. Add to this the 34.26% of businesses that are unsure if they can stay ahead of local competition and it’s clear there are still many challenges facing Irish businesses.
What steps are Irish businesses taking to overcome these challenges?
With so many concerns floating around smaller Irish businesses, it’s worth asking whether or not businesses are prepared to put the time in to meet these challenges going forward, and the good news is that many of the business owners we spoke to appear to have plans in place to offset the repercussions of the concerns they’ve raised.
First and foremost, 40.64% of those who responded to our survey said they were considering expanding their product and service offerings, both to widen their customer base and to compete with rival competitors. Alongside this, a further 37.85% were looking at investing in the digital technology required to modernise their business.
But perhaps most importantly of all, and perhaps suggesting that people are preparing for a potential slide in the Irish economy going forward, 36.65% of the survey respondents said they now had a plan in place to save on supply chain and service provider costs, as well as 36.25% also having plans formed around saving money on overheads.
Finally, a solid 35.06% of businesses who got back to use mentioned that they were interested in reworking their business to be more eco-friendly, which in turn would reduce the overall energy costs of their business when it comes to energy bills.
How important is digital technology in the growth of Irish businesses?
Nowadays, it’s safe to say that the majority of businesses know the importance of having an online presence, and it’s no different for smaller Irish businesses. As our survey shows, a full 90.44% of survey respondents said that digitally transforming their business held at least some degree of importance for their future growth plans.
And when we break that statistic down further, we can see that at least 48.21% place this digital transformation as a top priority, with a further 42.23% putting it as a medium priority on their business’s to-do list.
In fact, out of all the businesses we spoke with, only 0.80% said they felt that digitally transforming their business was of little concern to them, with another 8.37% classing it as neither important nor unimportant for them.
In other words, technological innovation and adoption are of big concern for the vast majority of Irish businesses going forward in 2024.
What concerns do Irish businesses have around customers
Turning now from direct challenges that Irish businesses could face going forward, we also wanted to examine how changing consumer habits and trends were impacting the confidence of Irish businesses as well. And, for the most part, it would appear that most local Irish businesses are concerned about customer retention above all else.
Indeed, 50.20% of business owners we reached out to put this as their number one concern, and it’s only something that’s being further exacerbated by customers taking more time to decide whether or not to make a purchase – a point that another 47.41% of businesses appear to be eyeing with caution.
Add to this the fact that 45.42% of business owners have additional concerns around customers making fewer purchases, and 42.23% worrying about customers spending less overall, and it’s clear that reduced consumer spending habits are actually of major concern to many small Irish business owners.
How confident are Irish business owners in the future of their business?
So, with all of these concerns in mind, how confident are Irish business owners when looking at the future of their business going forward? Is there an air of cautious optimism, or is the outlook bleaker than anticipated?
Well, in stark contrast to the myriad of concerns on display that might suggest a more cautious outlook, it would seem that Irish business confidence is at an all-time high, with 40.24% of businesses in our survey outright saying they were fully confident that their business would grow throughout 2024 and beyond.
Not only that, but another 23.11% were at least positive about the potential growth of their business, though they still acknowledged their concerns, alongside a further 21.91% believing their business would be capable of performing well, even in the face of unforeseen challenges.
In fact, only 7.17% of business owners said they were worried about the future of their business and the challenges ahead, making it very clear that, in spite of all the worries 2024 might bring, there is a positive and confident outlook coming from most Irish businesses.
What are the main concerns for Irish businesses over the rest of 2024?
To wrap up then, let’s look briefly at what the main personal concerns are for Irish businesses going into 2024 and beyond. Is inflation still on everyone’s radar as a major issue or are there more immediate and pressing concerns afoot?
Interestingly, it would appear inflation is not everyone’s main concern, as 37.05% of Irish businesses in our survey pointed out that both staff layoffs and changing their business’s location were actually at the forefront of their mind where future issues are concerned. Although 35.86% did still note that rising prices were a continual worry.
Alongside this, another 32.27% were concerned about writing off an increasing number of payment defaults, and 31.87% feared they may even have to sell their business. Finally, another 31.47% were also mildly concerned about taking out a loan to cover business costs, with a further 31.08% looking to seek financial advice to potentially avoid this.
What can small Irish businesses do to alleviate their concerns?
Overall then, it’s clear that Irish business confidence is high, but so too is a substantial degree of awareness around what challenges local businesses might face over the rest of 2024 and into 2025.
But if you’re just starting a business or perhaps don’t have any firm plans in place to deal with unexpected market changes that may occur, what can you do to make sure your business is protected financially?
Well, as it turns out, there are plenty of things you can do to help your business tackle any unforeseen obstacles going forward, including doing any and all of the following:
Plan for the future – it never hurts to sit down and make a backup plan that puts contingencies in place that you can follow to protect your business should an unexpected economic downturn hit you particularly hard.
Look to cut costs – whether this is by changing energy providers or working out bulk deals with your suppliers, it’s always worth examining your business overheads on a regular basis and looking at how you can adjust these to save money.
Diversify your portfolio – although focusing solely on producing and selling one specific product or service can position you as a leading expert in that area, diversifying your portfolio into other related markets is a great way to offset the impact of low sales should you experience a period of consumer drought.
Get online – at the end of the day, any good modern business needs an online presence, even if the service they offer has no digital element. Simply put, most customers are now using the internet to find the products and services they need, so getting online will only benefit your business in the long run.
Offer discounts and loyalty programmes – finally, even though it might impact profitability briefly, offering discounts and financial incentives or benefits to new and previous customers alike can be a great way to boost customer retention and loyalty, ensuring you make more sales in the future.
Take your business online with SumUp
And there you have it, that was our Irish business confidence report for 2024 going forward!
It certainly seems like confidence is on the rise for Irish businesses, and we’ll certainly be keeping an eye on things as we continue into summer, autumn, and winter, but for now, we feel confident in saying that things will only get better for smaller companies across Ireland as we enter the sunnier months of the year!
Of course, if you want to lend your business a hand right now, especially if you’re finally taking things online, then SumUp might have just what you need.
Whether it's finding a new payment solution for your website, or installing easy-to-use card readers in your store, SumUp has everything you need to streamline your customer sales interactions and empower fresh business growth.
Get in touch today to see how we can help your business reach new heights!
