Enterprise Northern Ireland (ENI) has just released findings from the 2020 Enterprise Barometer and figures show that 85% of small, micro and self-employed businesses here have been negatively impacted by COVID19.
Almost 600 small businesses participated in ENI’s Enterprise Barometer Survey which paints a challenging picture of the economic landscape.
Cash flow and liquidity concerns are at the forefront of business owners’ minds. 70% of businesses reported a decrease in turnover over the last 12 months and this is compounded by an underlying concern from businesses who borrowed money to survive the global crisis, with 1 in 5 extremely concerned around their ability to pay back business debt.
The survey covers largely micro enterprises (less than 10 employees), small business (less than 49 employees) and the self-employed. This group however represents 99.2% of all enterprises in the NI economy.
Reflecting changing work trends accelerated due to the pandemic, 42% of businesses plan on increasing flexible (home) working, with 1 in 5 planning to decrease external working space.
Concerns about Brexit saw almost half of the businesses surveyed expecting the exit from the EU to have a negative impact on their business with only 4% expecting a positive impact.
There are huge issues around a lack of Brexit preparedness, with only 1 in 5 businesses preparing and 55% saying they don’t know where to get help and guidance.
The vulnerability of Northern Irelands micro and small businesses is clear to see as the uncertainty around future trading deals and the implementation of NI-GB controls continue. 70% of the businesses purchase from GB whilst 66% of the businesses sell outside of Northern Ireland.
CEO of ENI, Michael McQuillan said: “No-one will be surprised that this year’s Enterprise Barometer has raised serious concerns around the impact of both the global pandemic and the impending exit from the EU. However, the high level and complexity of difficulties resulted in some soberingly shocking findings.
“It is vital to remember that the Enterprise Barometer 2020 has also given businesses the opportunity to clearly state the support that they urgently need if we are going to give the NI economy any chance of recovery.
“It has been an incredibly challenging year for our micro and small businesses and the self-employed and the survey findings really signify just how critical it is that we listen to what they have told us, act now and provide the support they need.”
“The businesses we surveyed make up 99% of the NI economy so it is vital that we listen to them, remembering they are the bedrock of our economy generating a pipeline of bigger exporting businesses and the supply and service chains for our FDI businesses.
“The Enterprise Barometer must inform strategic policy and shape practical interventions throughout the enterprise development ecosystem – we must collectively translate what businesses have asked for into easily accessible bespoke support and guidance.”
Northern Irish Economist, Maureen O’Reilly, who led on the Enterprise Barometer research added: “Once again the Enterprise Barometer has been incredibly informative and gives an eye-opening snapshot of the struggles of this vital sector of the NI economy.
“This year’s survey really highlights the tremendous pressure currently on start-ups and early start businesses specifically, who are struggling most in the current difficult climate.”
Chairman of ENI, Nick O’Shiel, added: “More than 3000 early stage and established micro and small businesses engage with the ENI network on a weekly basis, so we are uniquely placed to reach out to the sector. I am delighted that Enterprise Barometer has once again produced a very telling and accurate picture of the state of this sector using information gathered at the coal face.”
Mr McQuillan added: “It’s important to bear in mind when we talk about businesses in this context, we are talking about people, behind these numbers and statistics there are families and individuals many of whom are suffering not just financially but also in terms of their health and well-being.
“With this in mind, ENI believe a comprehensive and immediate response for our small and micro businesses that are struggling is necessary - getting the support they need on to the ground and easily accessible. We then need to ensure there is an integrated Enterprise and Entrepreneurship strategy at the heart of all economy planning and decision making in the region. It is only through effectively supporting our early stage businesses and our mainstay micro and small business population will we have any chance of rebuilding and growing in the future.”
2019 ENI survey finds NI business agile but fragile
Enterprise Northern Ireland recently released the largest business survey of its kind in the region and findings suggest that up to 6,200 businesses across NI could be in difficulty today.
Over 1250 small businesses participated in ENI’s Enterprise Barometer Survey which paints a diverse picture of the economic landscape with 51% of businesses reporting growth over the past 12 months while around 1 in 10 businesses are contracting, with 1 in 20 in difficulty.
The survey covered largely micro enterprises (less than 10 employees), small business (less than 49 employees) and the self-employed. This group however represents 99.2% of the enterprises in the NI economy.
Brexit is a key concern for many of the businesses who responded to the survey but there are more fundamental concerns around the availability of skilled workers, access to finance and investment in technology and training.
CEO of ENI, Michael McQuillan said: “The survey analysis depicts an agile business population. Despite huge uncertainty 51% of businesses surveyed have reported growth over the past 12 months with 1 in 10 growing strongly. These businesses have the agility and determination to navigate around and through a range of barriers.
“The nature, however, of a small and micro business is that it doesn’t take much to stop progress. These businesses are more vulnerable to: customers taking too long to pay; a customer going out of business; a change in regulations; or a hike in supply costs than their larger counterparts.
“Making up 99% of the NI economy it is critical that this fragility is acknowledged and that these businesses – the backbone of our local communities – are protected and supported. Around 1 in 10 businesses are contracting, according to the report, with 1 in 20 being in trouble. This could mean that 6,200 small businesses across Northern Ireland are in trouble today.”
The aim is for this inaugural survey to become an annual barometer that will inform strategic policy and help shape practical interventions throughout the enterprise support ecosystem.
Northern Irish Economist, Maureen O’Reilly, who led on the Enterprise Barometer research added: “The response shows that micro and small businesses want and need to have their voices heard.
“The Enterprise Barometer is a critical timely picture of the most important part of our economy – small and micro businesses and the self-employed – 99% of all enterprises.”
Mr McQuillan added: “These valuable insights must be discussed and understood so that we can adapt the enterprise support ecosystem to help our local small businesses to survive and thrive.
“More than 3000 early stage and established micro and small businesses are engaging with the Enterprise NI network on a weekly basis. They are the lifeblood of our local communities and we must not neglect that in the uncertain and volatile period ahead.”
When asked about Brexit, 77% of the Barometer respondents say that Brexit (in any form) will impact their business with 40% believing that the impact will be severe and 52% very concerned about the potential of a ‘no-deal’ exit happening. Only around 1 in 4 (24%) have implemented any Brexit related preparation.
Mr McQuillan continued: “Enterprise NI want to work with other key stakeholders in enterprise support to call for a NI Enterprise & Entrepreneurship strategy to be central to future economic strategy in a future programme for government. There has been nothing in place for close to 15 years.
It is crucial that our politicians return to Stormont and form a fully functioning Executive. There will be a heavy workload on those Ministers to restore confidence and to provide leadership, strategy and vision for the business and wider community. In its absence our civil servants must be empowered to make both short and long term financial decisions and that the totally inadequate system of one year budgets in brought to an end as a matter of urgency.
“Unless we have a focused plan in place with the aim of increasing the number of quality start-ups and increasing the number of well-run businesses that survive and thrive – we will jeopardise local community prosperity, local social cohesion, local health and well-being and we will not generate meaningful jobs or stop the damaging exit of young talent.
“We need to adapt our approach to the development and support of enterprise in Northern Ireland in a structured way, to impact economically but more importantly socially.”