Irish SMEs are strongly optimistic about their future growth prospects according to new research carried out on behalf of Virgin Media Ireland by Amárach Research, where the leaders of 200 companies with 1-12 employees were interviewed directly.
In all, 85% of respondents are expecting good growth over the next 12 to 24 months. This positive outlook has implications for employment with 37% expecting to increase their number of employees over the same period.
Equally encouraging is the fact that more than half (58%) of the companies surveyed are expecting their total revenues to increase while 54% expect productivity to improve.
Cork trails Dublin in social media usage by SMEs.
“These results are very encouraging and show that the recovery is now firmly established in the SME sector”, said Gavan Smyth, Vice-President for Business Markets, Virgin Media Ireland. “When growth forecasts translate into hiring intentions it is good news for everyone.”
Very significantly, almost three-quarters (74%) of SMEs now have a business website and, of these, 36% are e-commerce enabled. That means that 27% of Irish SMEs are now engaging in e-commerce which is very positive considering that the EU average is around 18%. In addition, more than two-thirds (68%) of those with a business site have it optimised to work across a variety of different platforms such as laptop and smartphones.
“It’s clear that Irish businesses are recognising the value of an online presence as well as the e-commerce channel”, said Gavan Smyth.
“Those companies with e-commerce enabled websites reported that, on average, one third of their sales came from that channel. This is a very important finding and is in line with the Government’s recent research in relation to its Trading Online Voucher scheme which showed that businesses which had taken part had increased sales by an average of 21%. While great progress has been achieved over the past two years in Ireland, we must continue to accelerate this trend.”
Interestingly, the findings of the Virgin Media survey in relation to social media were quite mixed. While the majority of firms (55%) have a Facebook page, just 23% have a Twitter account, and 26% use LinkedIn either for corporate or personal purposes. However, almost four in ten (38%) of those who do use social media currently don’t believe it has contributed to the growth of their business.
“This is an interesting finding and may indicate that SMEs have difficulty in realising the potential of social media due to a lack of resources”, said Gavan Smyth.
“Our research showed that the average amount of time dedicated to social media each week by SMEs in Ireland is just four hours. This is probably not sufficient to make a real difference to the bottom line for most businesses.”
The growing importance of the internet to Irish business was indicated in the finding that reliability is now seen as the single most important factor when it came to broadband service. Speed and cost came in at second and third place respectively. Indeed, a high percentage (48%) of businesses were unaware of the speed of their broadband connection.
“The fact that reliability is now so important for so many businesses is an indication of how much they now rely on the internet as a communications channel”, said Mr. Smyth.
“Businesses need to be connected and able to communicate with their customers. Speed and cost mean nothing if you cannot rely on the service. Virgin Media customers consistently tell us that it is the combination of all three that we offer that is the main reason they chose us for their broadband service.”
Gavan Smyth concluded by pointing to the lack of regional variations in the survey findings in relation to business outlook.
“We have heard much about the so-called dual economy and how the recovery is limited to Dublin and one or two of the other main cities. This is not borne out by the findings of this research which show that businesses throughout the country are equally optimistic and positive when it comes to growth prospects and hiring intentions. With more businesses going online and availing of the competitive advantages and efficiencies offered by high speed, high quality broadband the very good news is that the benefits of the digital economy are being felt throughout the whole of Ireland.”