Inflation is the number one threat facing Irish SMEs according to a survey by Azets Ireland which shows that if economic uncertainty persists, one in three are considering cutting jobs.
According to a survey by Azets Ireland, the professional services firm that specialises in supporting the needs of SMEs and family owned businesses, 43% expect the economic climate to worsen in the next 12 months.
Neil Hughes, CEO of Azets Ireland said inflation is proving to be a significant challenge for SMEs throughout the country. "Every aspect of doing business is becoming more expensive and rising prices is putting a squeeze on already tight operating margins.
"This is impacting sentiment in the sector with 4 in 10 SME leaders expecting the economic climate to worsen in the next 12 months. Given the numerous challenges facing owner-managed and family businesses in Ireland, there is likely to be a greater number of SMEs needing support in the face of financial difficulty."
When questioned on the outlook for the business, 19% of SMEs expect their revenue and profits to increase in the coming year and 63% to remain the same, with only 18% anticipating a decrease.
The survey highlights that 1 in 4 SMEs expect the tax burden to increase while only 1 in 10 think it will decrease.
The Azets SME Pulse Survey also reveals that only 1 in 5 Irish SMEs are currently measuring their carbon footprint. The main challenge for the SME sector in progressing their ESG goals is the costs involved.
"Despite lingering uncertainty and the slow progress in advancing sustainability, it's encouraging to see SMEs remain optimistic about the future of their business and committed to driving innovation to fuel growth," Mr Hughes said. "It is this focus on transformation that will be key for Irish SMEs as they continue to build their resilience and adapt to a rapidly evolving world. Our growing team of specialists at Azets Ireland will be relentless in meeting the specific needs of Ireland's entrepreneurs and supporting the growth ambition of SMEs in every sector."
Azets Ireland is holding its annual conference this evening to exchange ideas and insights on what fuels growth during these rapidly changing times.
