SMEs pivot towards online as pandemic restriction lift

Recovery slower for female-led SMEs, says Facebook report
Image: athree23, Pixabay

15 September 2021

The Irish SME sector is showing strong signs of recovery from the challenges caused by the pandemic, according to Facebook’s State of Small Business report.

With the latest easing of restrictions and the successful roll out of the vaccination programme, Irish SMEs surveyed in July reported a significant increase in sales and confidence compared to the last report in February 2021.

Facebook’s State of Small Business report found 78% of Irish SMEs were operational and generating revenue, up from 68% in February. Of these operational SMEs, 36% reported higher sales, showing businesses are getting back on their feet since last surveyed when only 10% reported higher sales. Irish SMEs are also ahead of the global average with only 28% of businesses reporting higher sales.




Covid-19 generated a shift in how SMEs around the world and in Ireland do business. Online sales became a lifeline during the pandemic to help keep many of these businesses afloat. The report shows that those who made the pivot to online are still reaping the benefits even as stores physically reopen.

Half of Irish SMEs report that at least 25% of their revenue is generated by digital sales, up from 35% of SMEs in February, demonstrating that shoppers can continue to support Irish entrepreneurs even when moving to online retail. In addition, of the 30 countries surveyed, Ireland showed the second biggest gain in terms of the share of SMEs using digital tools to support their growth.

Employment trends are also positive, with just 18% of business owners having to reduce their workforce, compared to 25% in February. The future outlook for employment may also be helped by a surge in hiring for Christmas, with 18% of Irish SMEs saying they plan to increase temporary employment over the next 6 months with seasonal hires.

Irish SMEs also appear more optimistic about their future trading, with 64% saying they are confident in their ability to stay open for the next 12 months. This is up from 53% in February, and well ahead of the global average of just 48%. However, 36% of Irish SMEs still expect to encounter cash flow challenges, an improvement on the 54% of companies with these concerns a year ago.

The research also indicates a divergence in the pace of recovery for women-led SMEs versus male-led businesses, with 32% of women reporting higher sales compared to 43% for men. A lower percentage of female-led SMEs (72% versus 83% for male-led) were operational in July.

“It’s fantastic to see the significant increase in sales and confidence among Irish SMEs in our latest report,” said Oliver Sewell, director of Business, Ireland and UK at Facebook. “It’s clear that the easing of restrictions have contributed to a crucial boost in economic activity, and in turn have had a positive impact on customer demand and employment outlook for small businesses. Online sales were a critical lifeline for many SMEs through the pandemic, and the shift online is set to endure. Half of Irish SMEs are now making at least 25% of their sales online, even as physical stores have reopened.

“This is an opportunity to remind people that shopping online doesn’t mean they have to turn their back on small Irish businesses. They have worked incredibly hard to keep afloat and establish digital storefronts over the past year. These businesses deserve to be found, and they can be found online in a matter of seconds through our platforms no matter where they’re located.”

TechCentral Reporters

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