Monday 23 October 2017

Irish SMEs top in Europe for cross-border online trading

Ireland ranks first out of 28 countries in Europe when it comes to small firms selling online. Stock Image
Ireland ranks first out of 28 countries in Europe when it comes to small firms selling online. Stock Image

Adrian Weckler and Colm Kelpie

Irish small to medium-sized businesses rule Europe when it comes to eCommerce and cross-border online trading, new research shows.

Ireland ranks first out of 28 countries in Europe when it comes to small firms selling online, turnover from eCommerce and cross-border ecommerce, figures from the European Commission's Digital Economy and Society Index (DESI) show.

Irish companies are also among the top users of social media to achieve business ends, the DESI figures show.

But despite the uptake in online selling, many small Irish businesses are failing to tap into international markets because they won't spend the time travelling, the head of the Small Firms Association (SFA) has said.

Patricia Callan said multinationals have told the SFA that Irish SMEs fail to expand "because people don't want to waste the shoe leather getting on a plane".

Ms Callan said some small firms reach a certain level of income, are happy with that and don't want to go any further.

"The vast majority of employment is in family businesses that might be five, 10, 20, 30 [staff] and they reach a certain size and they are running businesses, and would describe themselves as owner-managers as supposed to entrepreneurs per se," Ms Callan told the Irish Independent.

"They're not ambitious in terms of trying to internationalise, and where they are internationalising the easy route has been to go north or go into the UK."

Ms Callan was speaking in the context of Brexit, and SMEs exposed to the UK having to diversify into other markets.

She said one in every 2,000 businesses here are firms that start with ambitions to do business internationally.

She told the Trinity Global Business Forum that SFA had been trying to build procurement channels between multinationals here and SMEs.

"What I've heard back from multinationals is that Irish businesses don't want to grow in scale because people don't want to waste the shoe leather getting on a plane," Ms Callan said.

"When we built the likes of Glen Dimplex and those, you had guys who were on planes 200 days a year and nobody wants to do that any more. So you reach x level of income, you're happy with that."

Read more: Rising wage and fuel costs put squeeze on Irish SMEs

She said Brexit may give those firms who only want to export into the UK market the push required to tap into other markets.

The data from the European Commission suggests online selling has made it much easier to do that.

The figures also show that Ireland has the highest proportion of science, technology and engineering graduates in Europe per capita.

However, the EU results also indicate that Ireland has one of the worst rates of basic digital literacy among the rest of the population, with broadband availability and takeup still lagging the European average.

Despite Ireland's relatively poor broadband access, there has been a surge in online shopping here, with almost three-quarters of Irish internet users now shopping online, a jump from 63pc in 2015.

Irish companies are also among the top users of social media to achieve business ends, the DESI figures show.

But in a sign that print and broadcast channels are still strong here, we are the least likely among European consumers to read news online with just 49pc of Irish internet users using the web as their primary source.

Irish Independent

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