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Survey of SMEs reveals challenges of coronavirus pandemic

The Bibby Financial Services Covid-19 Pulse Survey of 200 Irish SMEs and Business owners has revealed the significant impact which Covid-19 is having on the business community. Responses from businesses across the manufacturing, construction, wholesale, transport, and services sectors shows how the pandemic is affecting how SMEs operate and the financial pressures on businesses.

Fieldwork for the survey ran from 31st July – 10th August 2020 and respondent businesses had an average annual turnover of €6m.

Here we give an overview of the report’s key findings. Alternatively, you can download a free copy of the full report for a unique insight into the challenges businesses are working to overcome.

Download the report

Key findings

  • Over a third of SMEs (34%) had to cease operations in response to the pandemic and lockdown
  • The same proportion (38%) had to close parts of their business
  • Almost a quarter will only be able to cover costs for the next 3-6 months if the current situation continues
  • More than half (54%) say social distancing has reduced their ability to take on new business
  • More than a third (34%) state cash flow difficulties as the biggest challenge for their business

Our research reveals the stark situation currently facing Ireland’s SME sector. While most commend the Government’s handling of the Covid-19 crisis, the measures needed to deal with it are having a lasting and profound impact on SMEs’ ability to do business. For SMEs and the wider economy to recover, we must ensure that businesses are aware of the range of funding supports available to help weather the storm. Mark O’Rourke Managing Director, BIBBY FINANCIAL SERVICES IRELAND

How are SMEs responding to the crisis?

SMEs are responding to the pandemic and lockdown in different ways. Almost a third (34%) of SMEs had ceased operations for a time, while the same proportion 35% say they had to lay off staff, and 38% closed parts of their business, either temporarily or permanently.

Returning to business post-lockdown

Over half (54%) of SMEs say social distancing measures have reduced their capacity to take on new business. In addition, 42 per cent of businesses have had to turn down new orders because they are unable to fill them.

Additional obstacles for SMEs attempting to secure new business include not having the working capital to buy raw materials (21%). 

Financial Pressures

The survey findings reflect the significant financial pressure put on businesses as a result of the pandemic. Over four in five (83%) SMEs were not using external finance prior to the Covid-19 pandemic – however 66% of those now say they would be more likely to use it in the future.

Almost a quarter (24%) believe they will only be able to meet their business costs for the next 3-6 months, and nearly three-quarters (71%) say they won’t be able to maintain costs for more than 12 months.

Almost a third of those businesses surveyed (31%) said they have temporarily layoff staff to save costs.

Bad debts and late payments

Since the outbreak in Ireland, half of the SMEs surveyed have experienced bad debt, writing off an average of €15,200. Over half (55%) of SMEs reported that customers were taking longer to pay than usual.


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