Medium-sized firms recover but smaller ones in trouble
Medium-sized companies are feeling the benefits of the recovery while smaller businesses are still experiencing inflationary pressures and difficulties accessing credit, a survey has found.
The country's smallest businesses have yet to show the same signs of confidence as their medium and mid-market counterparts, according to the Global Economic Conditions Survey (GECS) carried out by the Association of Chartered Certified Accountants and the Institute of Management Accountants.
ACCA Ireland chief Liz Hughes said the confidence surge experienced by medium-sized businesses comes with a note of caution.
"While many have confidence in the global recovery, the GECS analysis showed that those businesses were less confident when it came to their own business prospect," Ms Hughes said. "The underlying message seems to be that the outlook amongst SMEs in Ireland, while more positive, remains delicate."
The results are based on responses from 313 ACCA Ireland members responding to the survey between the end of 2011 and the first half of this year, including 84 small and micro companies; 52 medium-sized companies; 41 mid-market and 136 large corporates.
The survey found that while home-grown SMEs were among the least confident in the global economic recovery, there was a significant upturn in the first half of this year. But that confidence boost was mainly driven by a positive outlook from medium-sized and mid-market companies.
The survey also found differences in how businesses were responding to the crisis, with SMEs with fewer than 250 employees less likely to make staff cutbacks or reduce investment in capital.
But the survey found that they were also less likely to identify an opportunity compared to mid-sized companies and large corporates.
"It appears that as well as taking a bigger hit from the global economic crisis, smaller businesses are taking longer to find their feet again, and Ireland is a prime example of that," Ms Hughes said.