67% of Leinster SMEs have increased prices to customers due to rising costs

• 58% of Leinster SMEs report increased sales in the past six months, with 66% expecting further growth 

• 58% of Leinster SMEs report increased sales in the past six months, with 66% expecting further growth

• Operating costs rising significantly, with 45% in Leinster reporting increases of more than 11%, as businesses manage pricing pressures

• Half of Leinster SMEs have experienced supplier insolvencies and 53% report customer insolvencies in the last six months

• 61% in Leinster report a growing need for finance, despite challenges accessing funding

• Over half of Leinster SMEs (59%) expect to increase international trade, with M&A firmly on the agenda for 2026

Business confidence among SMEs in Leinster remains strong with 86% expressing optimism about their prospects for 2026 despite ongoing macroeconomic pressures and rising costs. This is according to new research conducted by Bibby Financial Services Ireland, a leading provider of financial support and funding solutions to Irish SMEs. The study focused on a range of sectors including manufacturing, construction, wholesale, transport and services.

The research shows that 58% businesses in Leinster are reporting increased sales over the past six months, up from 53% in the previous wave of research. Looking ahead, 66% in Leinster expect sales to rise further over the next six months, compared to 71% nationally, and increasing to 70% among Leinster SMEs suing external finance – highlighting the growing role of funding in supporting growth. 

Leinster SMEs continue to demonstrate a strong appetite investment, with 95% planning to invest in the coming year. However, rather than pursuing broad based expansion, businesses are being more selective about where they invest, with many prioritising investment in areas that support productivity, digital capability and operational resilience. 

Top investment priorities include:

• Recruitment (36%)
• Staff training and development (31%)
• Digital IT and technology (31%)

The average investment figure in Leinster is €188,100. This is compared to a national average of €196,730 and a Munster average of €434,484 – the highest across all provinces.

Rising costs continue to present a significant challenge for Leinster SMEs, with 59% citing energy costs as a primary concern, closely followed by inflation and high costs (56%). Respondents say that operating costs have increased significantly, with 45% reporting increases of more than 11%. As a result, 67% of Leinster SMEs have increased prices to customers, while 12% have increased prices significantly. One in five say the are unable to pass on costs and are absorbing the impact (29% combined).

Margin pressure is particularly acute among larger SMEs, with 90% of businesses nationally with turnover above €5million reporting reduced profitability. This highlights how cost pressures are increasingly influencing how businesses make spending decisions, not just their day-to-day operations. In practice, this means investment is being paced and prioritised, not paused.

Alongside cost pressures, SMEs are also dealing with increased risk in their supply chains and customer base. In the past six months, half has had a supplier become insolvent or stop trading, while 53% have experienced a customer becoming insolvent or ceasing operations. 

These challenges are more pronounced among internationally trading businesses, highlighting the added complexity and risk that comes with operating across borders. On average, Leinster SMEs reported two suppliers and two customers have become insolvent or stopped trading in the past six months. 

Almost two fifths (37%) of Leinster SMEs have also suffered a bad debt in the past year, with wholesale businesses particularly exposed.

Access to finance is becoming an increasingly important issue for SMEs, with 61% in Leinster reporting a greater need for funding and 47% saying they are now more likely to use external finance compared to a six months ago. This is compared to a national average of 46% reporting greater need – showing access to finance is particular pain point in Leinster, and challenges remain, with 61% believing access to finance has become more difficult.

More than half in Leinster (58%) believe banks are less willing to lend, while 44% feel that traditional bank funding does not fully meet their needs. Businesses are primarily seeking funding to support expansion and investment (49%) as well as day-to-day operations (26%), underlying the growing importance of finance as a strategic enabler.

International trade is firmly back on the growth agenda, with 59% of Leinster SMEs expecting it to increase over the next 12 months. Over a third (34%) identify international trade as a key opportunity, compared to only 12% in Munster, and 28% nationally, showing it is a huge area for growth in Leinster. At the same time, 57% of Leinster SMEs are exploring merger or acquisition activity for 2026, signalling ambition for growth. 

However, internally trading business are also likely to experience supplier and customer insolvencies, highlighting the increased risks that accompany global expansion. While uncertainty remains a feature of the operating environment, many Leinster SMEs continue to plan, invest and grow, provided growth is pursued with control, clarity and strategic intent.

Ala Brown, Business Development Manager in Leinster at Bibby Financial Services Ireland, “The latest findings highlight both the resilience and ambition of SMEs across the region, even in the face of ongoing challenges. It’s extremely encouraging to see that 86% of SMEs in Leinster remain confident about the year ahead, with an overwhelming 95% planning to invest in the coming months. This really speaks to the ambition and forward-thinking mindset of businesses in the region, despite continued economic and geopolitical uncertainty.

We’re also seeing strong commercial momentum, with 58% reporting increased sales over the past six months and 66% expecting further growth. At the same time, many SMEs are looking outward, with 59% identifying international trade as a key opportunity, showing a clear appetite to expand beyond domestic markets.

However, this optimism is not without its challenges. Rising costs continue to put pressure on margins, particularly energy costs, while the level of insolvencies among both suppliers and customers is a real concern for many businesses. This is having a direct impact, with SMEs facing bad debts and disruptions to their supply chains.

Access to finance is also becoming more difficult, with many SMEs feeling that traditional lenders are less willing to support them at a time when investment is crucial. It’s vital that SMEs are supported through this period with greater access to flexible funding solutions, alongside government measures to help ease cost pressures and protect growth.

While the outlook remains positive, ensuring SMEs have the right support in place will be key to sustaining this momentum and safeguarding the future of the sector.”