Brexit fears have doubled in 12 months among Irish businesses
15 September 2017
A BDO business sentiment index of over 350 companies shows that 40% of Irish companies now believe Brexit will have a negative impact on their business.
This news comes just 14 months after the Brexit referendum, when only 20% of Irish businesses believed Brexit would affect their business negatively.
Commenting on the findings, Michael Costello, BDO’s managing partner, said: “The prospect of Brexit negatively impacting the Irish market is becoming clearer for businesses in Ireland. This survey reveals that previous frustration over the lack of information from government is now changing to a feeling of concern among Irish businesses.”
“As the consequences of Brexit become more apparent for Irish businesses, we are encouraging them to engage proactively in scenario planning and assess the possible impact that Brexit will have on their business. We are advising clients to analyse their supply chains and business strategy, so they can isolate their exposure to the British market. “
Business activity and levels of operational profit both slipped in this quarter compared to previous years. One in four Irish businesses recorded a lower operational profit and experienced lower levels of business activity compared to the same quarter last year.
Despite businesses recording lower operational profits and reduced levels of business activity, overall, the survey found that businesses remain optimistic about the next quarter. 40% of businesses said they expect activity to increase in the next quarter.
Employment levels remained broadly unchanged in the period compared to a year earlier.
The survey also revealed that 24% of Irish businesses continue to increase their prices, an increase of five percentage points from 2016 as the shift towards higher prices continues.
Optimism is down marginally from this point last year, slipping from 66.4% in 2016 to 66.17% in 2017. Mid- to large-companies and businesses are the most optimistic, at 68.61% and 65.27% respectively. Overall, the survey found that companies remain optimistic.
Originally published by Chartered Accountants Ireland.
Click here to download the BDO Optimism Index.