Firms continue to experience recovery across the island, albeit at a slower pace than in recent quarters. This is according to InterTradeIreland’s latest quarterly Business Monitor (April – June 2015) which showed that 83 per cent of firms are either stable or growing, which is down five percentage points from Q1.
- 83% of firms across the island either stable or growing
- Cohort of growing businesses driving recovery – 40% of firms in Ireland compared to 36% in NI
- 53% of non-growth firms have ambitions to expand
Over the last few quarters, businesses in Ireland were clearly outperforming local NI firms but figures from the Q2 report indicated more of a convergence between the two jurisdictions, with 40 per cent of firms in the Republic in growth mode compared to 36 per cent of businesses in Northern Ireland.
There is a cohort of growing businesses in Northern Ireland that are driving the recovery and these need to be encouraged. This quarter the monitor specifically focussed on the characteristics that differentiate rapidly growing firms from the rest.
Commenting on the Q2 all-island report, Aidan Gough from InterTradeIreland said: “Recovery is in place for the majority of firms, but this is happening relatively slowly with less forward motion shown this quarter. We took the opportunity with the Q2 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 among larger firms. Particularly though, 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, were more successful.”
It was 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 per cent implemented new processes, machinery, equipment or tools.
Aidan 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.
“Nevertheless, 53% of non-growth firms share this ambition to expand, but need support from agencies such as InterTradeIreland to help them take advantage of cross border opportunities allowing them to overcome specific capability deficiencies in areas identified by the study and translate that ambition into reality.
“It is vital that the business momentum picks up more quickly if the Executive is to achieve its economic objective of rebalancing the economy. However, when you look back to this time two years ago, progress has definitely been made with only 64 per cent of businesses stable and growing back in Q2 2013.”
InterTradeIreland’s quarterly Business Monitor survey is the largest and most comprehensive business survey on the island and is based on the views of more than 750 business managers across Northern Ireland and Ireland. It differs from other surveys in that it is seen to be the ‘voice of local businesses’ feeding directly from telephone interviews conducted with a robust sample of firms of all sizes across a range of sectors to track all-island economic indicators such as sales, employment, business outlook and other specific topical research areas on a quarter by quarter basis.
For more information on InterTradeIreland and their business support programmes, please visit www.intertradeireland.com .
A copy of the 2015 Q2 InterTradeIreland Business Monitor Executive Summary can be viewed at: www.intertradeireland.com/researchandpublications/business_monitor/