Germany’s Hospital Future Act

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    The German healthcare market is the largest in Europe offering a wide range of opportunities for Irish medtech and e-health businesses.

    Due to a new law signed this year, the German government is investing €3 billion in digitalising its healthcare system.

    This Enterprise Ireland webinar examines

    • the opportunities arising from healthcare digitalisation

    • the Hospital Future Act and the significance for companies with relevant solutions

    • how to navigate the landscape and position your solution effectively

    This webinar is chaired by Enterprise Ireland Market Advisor Nicol Hoppe

    with expert insights from:

    Carsten Schmidt – Co- Founder of Digital Health Port

    German Healthcare System: Telekom Healthcare Cloud

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    The German healthcare market is the largest in Europe offering a wide range of opportunities for Irish medtech and e-health businesses.

    This Enterprise Ireland webinar discusses the importance of using a reliable cloud provider when providing business services to the German Healthcare System.

    Watch the webinar to hear insights from Alexander Gerlach,  Telekom Healthcare Solutions on:

    • Why businesses should use a trusted cloud provider in the German healthcare sector?

    • What makes the German market so unique?

    • Open Telekom Cloud: Public LaaS for European Enterprises

    • Importance of Data protection and compliance – Certifications

     

    Rising from the ashes

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    Photo of Manus Rooney

    As industry around the world slowly begins to get back on its feet after an unprecedented period of instability, Manus Rooney, Enterprise Ireland, Country Manager for the DACH region (Austria, Germany, and Switzerland), says the green shoots of regrowth are already beginning to take shape.

    “Like companies in many countries across Europe and indeed around the world, Irish firms have faced several challenging years with Covid and Brexit and more recently the disruption to supply chains and price increases in raw materials,” he says.

    “But despite this, exports to the Eurozone grew in 2020 by 1.6% to €5.85 billion and 23% of Enterprise Ireland supported companies’ exports are to the region. In addition, Ireland was the only EU state in 2020 which experienced positive economic growth. So despite the challenges, there are plenty of opportunities available for Irish companies across the region, which comprises of 440 million people and is the biggest free trading area in the world.”

     

    Benefits of being part of the Eurozone

    According to Rooney, the single market and customs union is an extension to our domestic market, which is of huge benefit to Irish firms – particularly as the EU is investing over €2 trillion to make Europe greener, more digital, and more resilient.

    In addition, each member state has committed investment in a range of their own national priority issues – providing great opportunities to leverage the increase in investment.

    “Of course, like a lot of markets around the world, Covid has had a big impact, particularly on travel and tourism – but numbers have shown that Irish companies have been very resilient throughout the pandemic,” he says.

    “The region, as a whole, is now in recovery with a lot of strong optimism, which has been fuelled by the opening up of the leisure and tourism sector – and recovery in Asia is driving business across the Eurozone.” says Rooney. 

    “Vaccination and the easing of restrictions is also leading to a faster than expected recovery, so the EU and the Eurozone are set to expand at equal rates of 4.8% this year and 4.5% in 2022.”

     

    Supports for business

    Enterprise Ireland supports clients across its eight offices in the region and while Ireland’s good reputation has traditionally stemmed from our food and drink exports, the region expert says Irish firms are increasingly gaining a reputation for innovation and flexibility.

    “A lot of the markets in the region are sophisticated with local incumbents and alternatives so the key, for Irish companies wanting to scale, is to translate this innovation into value and a language the customer understands, which often needs to be tailored market-for-market,” he says.

    “Planning is also so important, and we have seen time and time again that companies which take part in our Enter the Eurozone programme or put in the effort to plan early, will reap rewards in the end. This also applies to selecting the right market – not all are the same – so I would encourage SMEs not to focus simply on size but to look at what makes it attractive to them and whether or not they have the resources and skills to access it.

    “They should test and validate their findings and then determine the value proposition for the local market by working out who the target customer will be and what they will be looking for. Then they can determine what value they, as a company, can bring to the table, whether that involves benefits around price, speed, simplicity, or compliance. And as nothing happens without resources, plans should be costed and agreed in advance.”

     

    Success in the region

    While Manus Rooney and his team are on hand to offer advice and support to companies wishing to enter the market in the DACH region, there are already a number Irish firms with a strong foothold in the market.

    “There are many Irish companies who have already reached success in the DACH region, and each have taken different approaches to build scale across Europe,” Rooney says. 

    “These include Dennison Trailers who have recruited locally and the Watershed Group in Germany, the latter who have grown by acquisition to build and scale quickly.

    “In France, PEL Waste Reduction Equipment use a local distributor and recently won a tender with Metropole of Marseille – and in Benelux, Druid Software work with their partner Koning & Hartman – who have enabled them to sell into the Port of Rotterdam.”

     

    Opportunity and digital information

    It is clear that there is a lot of opportunity for Irish businesses across the Eurozone and Enterprise Ireland is currently running a webinar series, Europe is our Future, the most recent of which looked specifically at Building Sales and Marketing for a European Audience.

    “It is very relevant for companies looking to start and scale in the Eurozone,” Rooney explains. “And it uniquely offers insights from both European and Irish company perspectives on how they approached building European sales and marketing capability.

    Learn more about Enterprise Ireland’s Enter the Eurozone programme and watch our webinar Europe is our Future: Developing Sales and Marketing for a European Audience.

    Net Zero UK – Ready For a Green Future

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    The net zero challenge facing the UK will precipitate fundamental changes to the UK economy and to the ways in which business is done.

    To help companies understand how these changes will affect their sector and their business, Enterprise Ireland UK has launched “Net Zero UK – Ready for a Green Future”, a new market intelligence initiative for Irish exporters to the UK.

    The Enterprise Ireland UK office will be providing focused sectoral insights on the key UK net zero challenges, opportunities, and market developments. This will include analyses on products and services that are at risk of becoming obsolete and an examination of future net zero technology trends and demand areas. This market intelligence will help to inform your company’s strategic business planning and R&D efforts, helping to future-proof your activities in the UK market.

    A series of webinars featuring sector-focused sustainability experts, corporate stakeholders and UK net zero policy specialists will take place daily between Tuesday 22nd and Friday 25th June.

    Learn more and register below:

     

    Webinar – Net Zero UK Overview, Why, When and How? 

    Tuesday 22nd June, 15:00 to 16:00

    The net zero challenge facing the UK will reform the ways in which business is done. To help Irish exporters understand how these changes will affect their sector and growth, Enterprise Ireland UK and UK net zero experts will host a market insights webinar to examine:

    • The major industry and policy drivers that will accelerate the UK economy towards net zero emissions

    • The impact of the UK’S Sixth Carbon Budget, Green Industrial Strategy and individual corporate net zero plans

    • Key sectoral updates

    • Enterprise Ireland’s organisational climate action strategy

    • Green initiatives such as the €10 million Climate Enterprise Action Fund

    Register today

     

    Net Zero UK webinar series

    Net Zero UK Overview – Introductory Session   – 22nd June 15:00-16:00 

    Getting to the start line of the race to Net Zero – Decarbonising the Construction Supply Chain  – 23rd June 10:00-11:30

    The Role of the Energy Transition in UK Net Zero   – 23rd June 15:00-16:00

    UK Local Authorities and Net Zero   – 24th June 15:00-16:00

    UK Agriculture and Net Zero   – 25th June 10:00-11:00

    Market Watch – A view from Manchester

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    Key Takeaways

    • The UK is the largest export market for Enterprise Ireland clients
    • The North West of England has been growing at a faster rate than London in recent years.
    • The Manchester office for Enterprise Ireland opened in 2019 and is providing support for many Irish firms operating into and in the region.
    • Despite Covid and Brexit, business is still moving.
    • There are opportunities for Irish companies in many areas including construction, healthcare, digital technology, and life sciences
    • Irish companies may also achieve contracts with local authorities

    As our closest neighbour, the UK has long been a crucial trading partner for Ireland and as one of the fastest growing regions of the country, the North West of England was the obvious choice for Enterprise Ireland to open up a second UK office last year.

    Headed up by Laura Brocklebank and her colleague Kevin Fennelly, the Manchester branch focuses on opportunities for Irish clients in manufacturing – covering areas such as pharmaceutical and food and drink as well as paper, print and packaging. It is also leading on UK local authorities with major spending budgets across infrastructure, transport, healthcare and more.

    “The UK is the largest export market for Enterprise Ireland clients, which, despite the challenges of Brexit, grew 2% to €7.9 billion in 2019, with all non-food sectors recording growth of 6%,” says the senior marketing advisor.”

    And the market continued to perform strongly in spite of uncertainty, demonstrating that client companies have remained committed to the UK market and its short/medium-term growth potential.

    “Adding to this, the north west of England is a particularly dynamic region which actually grew at a faster rate than London in recent years – in fact, if it were a country, it would be the 12th largest economy in Europe. And this was the key driver for Enterprise Ireland when selecting Manchester to locate its new office last year.”

    Brocklebank says the Greater Manchester region alone is the size of the Irish market and the combined authorities of Greater Manchester, the Liverpool City Region, North of Tyne, Sheffield City Region and Tees Valley have devolved powers which means that decision-making powers and funding are transferred from Westminster to these regions.

    “The UK remains a key first export market for Irish industry to enable them to innovate and diversify and for these reasons, many Irish companies look to the North of England to set up a presence in the UK and it is often their first overseas presence,” she says.

    “Our Manchester team focuses on opportunities in manufacturing, along with partnerships with UK local authorities who have major spending budgets. We collaborate extensively with our London office and work as one team with our 20 colleagues who are specialists in various sectors including Construction, Life Sciences, Healthcare, Digital Technologies, Cleantech and Renewables – all of which are of strategic importance and opportunity across the region. In effect, we are also the eyes and ears on the ground for our colleagues leading these sectors.

    “As the North of England is traditionally the industrial heartlands of the UK, having a base here shows our commitment to the region and we are attuned to the needs of Irish companies, which are active all across the area.”

    Accessibility is key and the Irish Sea has long been an important link between the UK and Ireland. So as the Port of Liverpool has submitted a bid to become established as a UK freeport, the regional lead says this could provide an opportunity for Irish companies with relevant smart ports solutions and automated and high-tech solutions which facilitate maritime trade and logistics.

    “Ireland’s strong marine and civil engineering companies will be keen to collaborate with UK partners in the North West to help facilitate the necessary infrastructural upgrades required to cater for increased trading and customs realities,” she says.

    “In addition, over the past number of years the area has experienced a boom in new building and infrastructure projects and there are many Irish companies leading in the Construction sector – John Sisk & Son have created a major landmark with Manchester’s Circle Square Affinity Living Project, ESS Modular opened their Manchester office in July 2020, having completed a number of projects in Leeds and Oldham, and have a current project with North Manchester General Hospital. And Techrete’s architectural precast concrete cladding can be seen on the iconic One and Two St. Peter’s Square.”

    Manchester is also home to a fast-growing £5 billion digital ecosystem and has been officially ranked as the UK’s Top Digital Tech City, while Newcastle became Smart City of the Year 2019 for its innovative approach in using technology to help transform services and improve the lives of residents.

    The marketing expert says there is a lot happening in the region which could provide opportunities for Irish firms.

    “Digital tech company, Gamma Location Intelligence has recently opened their first overseas office in Manchester as they expand into the UK, having established in Ireland in 1993,” she says. “They have become a market leader in the provision of location intelligence systems and services which drive innovation across many sectors including insurance and retail, focusing heavily on cutting-edge research and development projects, leveraging Artificial Intelligence and machine learning.

    “And in October 2020, VRAI, a data driven VR stimulation training for high hazard environments, announced their expansion into the UK with their first overseas office in Gateshead’s PROTO Centre, the UK’s immersive technology cluster.

    “There are also opportunities for Irish businesses who can support local authorities in digital transformation, smart cities, connectivity, transport, housing, infrastructure, roads and highways and adult and social care. And a great example of this is SilverCloud which works with Greater Manchester Health and Social Care Partnership, providing support for those who may be feeling stressed and anxious due to the current pandemic.”

    Of course, there are still some challenges, with uncertainty surrounding both Covid-19 and Brexit but the UK will continue to be an important and attractive market for Irish enterprise.

    “Earlier this month, we had a rich and productive meeting with Greater Manchester Mayor, Andy Burnham and Liverpool City Region Mayor, Steve Rotherham, to discuss and agree the strongly aligned sectors of which Enterprise Ireland clients have strong supply chain capability,” says Brocklebank. “So we are looking forward to further collaboration and to have deeper engagement across these sectors.

    “Enterprise Ireland also warmly welcomes the announcement of a new Consulate General for the North of England and we are looking forward to working together to strengthen Ireland’s presence in the region.”

    To learn more about UK opportunities see the Evolve UK page here 

    Orbidal CEO

    Evolve UK Webinar – Selling your Digital Solution to the UK Public Sector

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    Laura Brocklebank, Senior Market Advisor, Enterprise Ireland UK and  Tony Corrigan, CEO, Orbidal will present best-practice and opportunities that exist in the UK public sector and how to be successful at winning UK Public Sector contracts. The webinar will feature:

    • Overview of UK Public Sector Procurement – Covid-19 update and what’s happening now?

    • Overview and opportunities that exist with UK Public Sector – Spotlight on Digital Frameworks

    • Best practice for prospective public sector suppliers

    • What makes a supplier successful at winning contracts?

    • Orbidal’s process to ease and simplify the process of tendering.

    Evolve UK Webinar – Pricing

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    This webinar,  in  conjunction with Simon-Kucher & Partners, examines the most important profit driver; Pricing. It will also discuss how professionally managing pricing can add millions to your bottom line.

    Chaired by Deirdre McPartlin, Manager of Enterprise Ireland UK, with expert insights from Simon-Kucher & Partners, a leading global consultancy specialising in top-line growth strategies with 35 years of experience with monetization topics of all kinds – from pricing strategies, customer segmentation, user experience, offer design, and packaging, to negotiation techniques, and sales excellence.

      • Mark Billige – CEO

      • Peter Colman – Partner

      • Phil Derby – Business Partner, Ireland

       

      Webinar Series: Free Trade Agreements

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      EU Free Trade Agreements (FTAs) with Canada, Japan, Mexico and South Korea enable Ireland to increase its trade, GDP and national income. The FTAs allow Irish exporters to explore new opportunities as market access increases and they benefit from competitive advantage in doing business in these countries.

      Join Enterprise Ireland as it hosts a webinar series on Free Trade Agreements and doing business in these four export markets: Canada, Japan, Mexico and South Korea.

      Each webinar will be opened by Robert Troy TD, Minister of State Department of Enterprise, Trade and Employment with responsibility for Trade Promotion. The webinars feature contributions from market experts and guest speakers from Irish companies who will share their experiences on doing business in specific markets.

      If you’re considering exporting to these markets, or scaling your existing export business, these webinars are for you.

      Click on the links below to register for upcoming webinars.

      Doing Business in Japan

      Thursday, 17 June 2021, 9am BST

      The EU Japan Economic Partnership Agreement provides a positive backdrop to Ireland Japan trading relations. This webinar will explore the experiences of key Irish business interests in Japan, and will outline the knowledge, networks and access supports available to capitalise on what is an increasingly important market for ambitious Irish exporters.

      For the full agenda and to register, click here.

       

      Doing Business in Mexico

      Tuesday, 22 June 2021, 3pm BST

      With duty-free trade on most goods and a simplification of the customs procedures, the latest 2018 EU-Mexico trade agreement has improved the already positive and prosperous relationship between Ireland and Mexico. This webinar features two market experts who will highlight opportunities and explain business culture and processes, as well as providing practical guidance for market entry.

      For the full agenda and to register, click here.

       

      Doing Business in South Korea

      Thursday, 24 June 2021, 9am BST

      The EU-South Korea FTA can provide enhanced business opportunities for Irish businesses. This webinar brings together experts on the topic to provide knowledge and insights on key elements of the FTA, and to enable Irish businesses to make use of the FTA to its fullest in doing business in South Korea.

      For the full agenda and to register, click here.

      Doing Business in Canada


      Tuesday, 25 May 2021, 3pm BST

      Attendees will learn more about the opportunities available in the Greater Montreal region, the Comprehensive Economic and Trade Agreement (CETA) between Canada and Europe, and what incentives are available to Irish companies looking to expand in North America.

      Watch back on-demand, available here.

      Patrick Torrekens, Head of the Enterprise Ireland BeNeLux

      Market Watch – Benelux

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      Overview

      • The BeNeLux countries (Netherlands, Belgium and Luxembourg) are working hard to return to normal business practise.

      • Health and safety remain a prime concern so remote working and virtual meetings will continue to be in place for some time to come.

      • Continued communication with clients is vital.

      • Opportunities are available in the biopharma, digital connectivity, and biotech sectors.

      Like the rest of Europe, the BeNeLux countries are working hard to return to some level of normality after Covid-19. And Patrick Torrekens, Head of the Enterprise Ireland BeNeLux team, says despite the fact that remote working remains in place, business is beginning to pick up in the region.

      “Just like many people across the world, I have been working from home for the past few months and here in the BeNeLux countries, remote working, particularly for the services industry, is still the recommended norm as part of the three countries’ re-entry strategy,” he says.

      “However, more and more production facilities, construction sites, engineering plants and office buildings are gearing towards full capacity and the ports of Antwerp and Rotterdam are fully operational with authorities doing everything to maintain the flow of goods in and out of the three countries.”

      Torrekens says health and safety remain the prime concern and the necessary measures have been taken to ensure social distancing on the work floor, on public transport and in public places. While industry heads and Government are doing everything they can to get everything up and running once more.

      “Things are not back to normal as yet, but the Dutch, Belgians and Luxemburgish, are keen to see business pick up again as quickly as possible,” he says. “When we are talking to buyers in our markets, we still hear that their focus is on adapting to the new reality on making their supply chain, and other critical processes, Covid compliant.

      “So any solution which helps them to achieve Covid compliance gets their full attention and that is why it’s so important to stay closely connected to your clients as they are also turning to their existing client base for inspiration and support at the moment. But BeNeLux decision makers are not currently looking at new investment projects so expect a delay in the sales cycle, be patient and stay connected with your in-market contacts.”

      But despite the delay in returning to normal, he says business is definitely moving in certain sectors and some markets remain buoyant.

      “There are opportunities and exceptions to be found, particularly in the sectors of high relevance for trade with Ireland,” says Torrekens. “The BeNeLux region is a hot spot for pharma and biotech research and innovation and it is expected that multinationals such as Johnson and Johnson, with research facilities in the Antwerp region, will invest in new laboratories for vaccine production and other virus related research.

      “So it is encouraging to see that some Irish companies are already preparing to play a part in this by strengthening their teams in markets.”

      The past few months have clearly pointed at the strategic need for digital infrastructure and the Netherlands, in particular, is a frontrunner in digital connectivity and continues to invest in its infrastructure.

      The Enterprise Ireland regional manager says communication is vital during these strange times, so Irish companies must do all they can to stay in touch with their clients.

      “An interesting fact to mention is that the Netherlands has witnessed the highest global growth rate of virtual meetings held over digital platforms in the past weeks,” he says.
      “So rest assured that if your contacts are not available for face to face meetings, they are definitely open, and accustomed, to online sessions. And please remember that the travel restrictions which are currently in place in the Netherlands, Belgium and Luxemburg should not prevent you from reaching out to existing clients and new prospects.

      “Finally Belgians and Dutch and Luxemburgish people have massively turned to online commerce and businesses have adapted their sales channels to accommodate this. This has given an extra boost to businesses in IT, and professional service but also in transport and logistics.

      “Ultimately, your solution will stand out if you have a strong value proposition which gives you a good chance to win more business in this region. And our teams stand ready to support you with advice and hands on support, so do get in touch, virtually for now, but hopefully face to face soon.”

      Get key insights on doing business in BeNeLux and the supports available from Enterprise Ireland.

      Out of their comfort zone and into the Eurozone

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      Industry across every sector of the country has been affected in some way or other by Brexit. But Ireland is still very much a part of the Eurozone and Anne Lanigan, Regional Director of the Eurozone for Enterprise Ireland, says it is vital that businesses in this country realise how valuable the European market is.

      To validate this, Enterprise Ireland and the IIEA (Institute of International and European Affairs) have come together to deliver a series of three events entitled ‘Europe is our Future’, aiming to change how Irish business views the EU.

      “The EU represents the biggest free trading area in the world, giving Ireland full access to this large marketplace and the three events, the first of which took on May 28th – with the second and third coming in July and September – aim to draw attention to this,” she says.

      Untapped trade opportunities

      “The webinars will highlight the unique trade opportunities for Irish business in Europe, particularly in relation to the single market and the single currency. They will also look at the untapped opportunities for Irish owned businesses in the EU and the strong reputation which Ireland, and indeed, Irish products and services, enjoy in Europe.

      “It will also help to increase Irish business’ understanding of the EU and position the Eurozone as an extension of Ireland’s domestic market as well as highlighting the supports available to Enterprise Ireland clients.”

      The single market was designed to enable frictionless trade between member states with no customs, tariffs or other barriers to trade and regulatory alignment across the region. With a population of over 440 million people this is the biggest free trading area in the world. And Lanigan says, this makes it a very big extension to our domestic market.

      “There are so many benefits to trading in a single currency as it introduces transparency and removes costs related to foreign exchange and the associated risks,” she says. “And Ireland’s adoption of the Euro has given Irish business access to a huge single currency market and an economy with a combined GDP of $13tr.

      “Of course, Europe is also a close neighbour and proximity has been proven to increase trade opportunities, while the increased direct maritime links to France, The Netherlands, Belgium, Spain and Portugal in recent months have brought us even closer.”

      This closeness has never been more important as when Brexit finally happened in December, it highlighted the challenges which had arisen regarding trading with the UK in their new status outside the single market.

      But, while Irish firms will continue to do business with the UK, there is no doubt that the benefits of the single market now make the EU very attractive, including the benefits of ongoing regulatory alignment. And Brexit or no Brexit, the Eurozone offers the cost and transparency benefits of a single currency as well as access to a very large market.

       

      Exports to the Eurozone

      “However, while the multinational sector in Ireland has reaped the benefits of the single market, Irish owned businesses have yet to take full advantage of what is the biggest free trading area in the world,” says Lanigan. “According to 2019 data, Enterprise Ireland client exports to the Eurozone (2019: €5.6bn) were equal to just 70% of the value of those to the UK (2019: €7.9bn). This is despite the fact that the Eurozone population and Eurozone GDP is 5 times that of the UK – this is an untapped and immediate opportunity. So, the Eurozone markets are now a key element of Enterprise Ireland’s strategy and in fact since the launch of our Eurozone strategy in 2017, exports to the Eurozone have increased by over 33% and growth in Enterprise Ireland client exports increased by 15% in 2019 alone. And exports to the Eurozone are steadily increasing as a percentage of over exports – in 2019 this was 22%, up from 20% in 2017.”

      With this in mind, the Eurozone expert says Enterprise Ireland is uniquely positioned and financed to help Irish companies to both enter and scale in Eurozone markets by offering one-to-one support, through its world class market research centre, financial support and promotion of innovative Irish produce and services.

       

      Enter the Eurozone

      There is also a programme of events to introduce European buyers to the innovative capabilities of Irish companies in sectors such as internationally traded services, high-tech construction, engineering, ICT and life sciences. And the four-month Enterprise Ireland Enter the Eurozone training programme, now in its 3rd iteration, brings a group of 25 CEOs and their sales and marketing teams through the necessary steps in successfully entering a Eurozone market.

      “In addition, the IIEA, which is Ireland’s leading international affairs think tank, aims to provide a forum for all those interested in EU and International Affairs to engage in debate and discussion, and to evaluate and share policy options,” adds Lanigan. “They celebrate their 30th anniversary this year and there is also a benefit for Irish companies to become members of the IIEA, so they can stay abreast of European affairs which may impact or present opportunities for their business in addition to networking with senior figures in business and government. “So, all in all, the future for Irish companies looking to do business in the Eurozone, is looking bright.”

      Pricing Excellence: Irish exporters need to develop a robust pricing structure to safeguard their business

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      We are currently entering a period of high inflation, with prices rising in the EU, the UK and the US. Even at home, the Irish Consumer Price Index rose to 1.7% for the year to May 2021. But after several years of stable prices, many companies are unprepared for the commercial implications of inflation, leaving them vulnerable both now and in the future – and this, according to the results of the Pricing Excellence study recently commissioned by Enterprise Ireland, is a very real worry for Irish companies operating in every country.

      Having a robust pricing strategy is important in every sector, but thanks to a prolonged period of low inflation, this skill has been underused and underdeveloped. “Pricing is a fundamental capability and relevant in every market,” says Deirdre McPartlin, Director UK at Enterprise Ireland. “It’s not a dark art or something mysterious, it’s a strategy that companies need to develop and fine-tune over many years. It has even been described as a ‘memory muscle’ that unfortunately has weakened over the years of low inflation. A pricing strategy requires both skill and confidence, and these can – and must – be learned and developed.”

      Why a good pricing strategy is so vital

      “For business to business companies, many of the SMEs we look after are dealing with powerful procurement departments that are highly skilled at getting the lowest prices,” says Deirdre. “Or they may be going up against bigger corporates that have very sophisticated pricing systems and strategies. And with online marketplaces and increased digitalisation, pricing is more transparent than ever – but it’s hard to explain value in those instances or compare like with like. And then there are companies with something completely new – how do you set a pricing strategy in a brand-new market?”

       

      Not charging enough

      An increasing number of Enterprise Ireland client companies have reported that they are finding the subject of pricing strategy more challenging recently. “We see clients that are so skilled at innovating, that work incredibly hard in winning a customer and in keeping a customer,” says Deirdre. “But they say that trying to monetise that innovation requires skill and confidence, so that pricing is not just ‘cost plus’.

      “We see customers with order books going out 18 months and yet they’re operating on the thinnest of margins – so they clearly have a very valuable product or they have customers that they’ve maintained for 10 years but they’re not getting the profit margin.” says McPartlin

      If you are struggling to find the margin to invest in sales & marketing or R&D to grow and protect your business, but you’re keeping your customers, then maybe you’re not charging for all you provide.”

      To look at the challenges being face by Irish companies around the area of pricing, Enterprise Ireland partnered with international pricing and strategy consultancy Simon-Kucher & Partners to conduct a survey of Enterprise Ireland client companies on pricing strategy. This was the first multi-sectoral pricing survey of Irish companies, and the results were compared with the global averages from Simon-Kucher & Partner’s Global Pricing Study 2021, which evaluates the pricing and growth strategies of companies across all industries worldwide.

      The study involved a survey of nearly 500 Enterprise Ireland client companies covering 12 industries. The sample included respondents across top and middle management positions in a range of B2B and B2C industries. And the results echoed what Enterprise Ireland has been hearing since the end of 2000 – that Irish companies were still producing goods and solutions valued by the market, but that profit margins were increasingly under pressure.

      According to the survey, Irish exporters have shown great resilience through the challenges posed by both Brexit and Covid-19, with 54% of companies reporting improving profits in 2020, comparing well with the global average of 59%. 

      According to the survey, Irish exporters have shown great resilience through the challenges posed by both Brexit and Covid-19, with 54% of companies reporting improving profits in 2020, comparing well with the global average of 59%.

      But with volume gain consistently identified as the key profit driver, and only 8% predicting that these improvements in profits will be sustainable in the long term, any profit gains are highly vulnerable to the impact of inflation rises.

      From the survey, 71% of respondents were planning a price increase in 2021, with 35% of respondents targeting price increases above the inflation rate and 34% planning a price increase in line with inflation. But the average realisation rate for price increases was 21%, which means that a company trying to raise prices by 2% would only achieve around a 0.4% increase on average. This puts many companies at risk of significant margin erosion – even if they were targeting for increases above inflation rates.

       

      Building skills and confidence in pricing strategy

      Price is the strongest profit lever for companies ahead of cost control and increase in sales volume, and these results clearly show that Irish exporters need to develop a sustainable pricing strategy. Not only is this important to protect profit margins, but it’s also needed to future-proof the business, by giving them the resources to invest in research and development, as well as the means to invest in important business functions like sales and marketing activities.

      “It’s not price gouging or exploitation, it’s about getting a fair price for the value that you are delivering,” says Deirdre. “We’re living in a time of inflation, which is relatively new for a lot of companies – for instance, we talked to some clients who hadn’t put in place a price increase for nine years. The study clearly shows the need for companies to invest time and skills into a pricing strategy that will equip the company for future growth and success.”

      Watch our on-demand webinar with Mark Billige, CEO of Simon-Kucher & Partners to learn the steps needed to implement a price increase process.

      Plenty to celebrate stateside this St Patrick’s Day

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      St Patrick’s Day offers an unrivalled opportunity to showcase Irish business innovation to a US audience.

      The traditional meeting between the Taoiseach and US President is taking place virtually this year, leveraging our important ties and connectivity with our trans-Atlantic neighbour more than ever.  

      The USA remains the world’s largest consumer market, a $22 trillion dollar economy. It grew by 4% in Q4 last year and early projections for 2021 indicate further growth of 3.2%, a strong performance for a developed economy.

      Increasingly Irish companies succeed here by recognising that the USA is no more one market than Europe is, and that to penetrate it they must go in state by state. California’s economy is, after all, approximately the same size as that of the UK. New York’s is approximately the same size as South Korea.

       

      The Pandemic Pivot

      The Covid-19 pandemic has had a significant impact, with unemployment currently at 6.9%, up from 3.5% prior to Covid, which was a 50-year low. Lockdowns vary by state but as a whole the US is a market where the pivot happened fast, and the return will too.

      One of the biggest trends we see is how major US multinationals, such as Facebook, Microsoft, and many others are embracing the lessons learned. They have ‘leaned in’ to the opportunities that remote working, accelerated technology adoption and virtual collaboration have presented.

      Interestingly, this has also led to a level of economic migration and mobility not seen in generations as more and more people also take advantage of operating remotely and move to less dense population centres.

      The crossing of the digital Rubicon has also led to accelerated growth in sectors that were once described as emerging, these include ecommerce, cybersecurity, and digital health. There has also been a marked increase in the demand for content driven by the rapid growth in usage and choice across stream platforms. These relatively sudden supply and demand shifts always result in direct and tangential opportunities, and threats.

      As people live more online, those providing back end solutions, such as data management (provision and support products and services) and security, are seeing potential for robust growth.

       

      Building Back Better

      Further bolstering the optimism for strong 2021 GDP growth is the economic stimulus plan put forth by President Biden, further supplemented by significant planned investment in infrastructure and the green economy. At time of writing the $1.9 Trillion stimulus plan has moved back to the US House of Representatives for final ratification, this is expected to provide significant economic stimulus across the US.

      Other sectors are of course challenged. International student numbers from the US to Ireland have fallen for obvious reasons. Consumer retail, for those that have not embraced ecommerce, is struggling, and other sectors that have historically relied on a tactile or physical element to the sales process, e.g. machinery, will naturally struggle more in a virtual environment.

      A big question affecting businesses, and unknown in terms of our ‘new normal’, is what airline travel will look like. Capacity is certainly not what it was pre-Covid and there are complex variables that impact this supply and demand dynamic, not least of which are staff and equipment availability. Thankfully we continue to be relatively well served on the trans-Atlantic route.

      Over the past 12 months Enterprise Ireland has also leaned in to supporting our clients to stabilise, reset and recover. Supports such as the Sustaining Enterprise Fund, Online Retail Scheme, Virtual Selling programme, Competitive Start, our many management training programmes and others have enabled companies not just to cope with the challenges of selling into the US and globally, but to compete for and capture the opportunities that now exist in our new normal.

       

      Virtual St Patrick’s Day Celebrations

      Enterprise Ireland is walking this walk too in our traditional St Patricks Day events, having taken the traditional week-long programme of events for St Patrick’s Day and working with our Team Ireland colleagues migrating it online. Where Team Ireland would normally have the Taoiseach, Ministers, and a programme of economic, political, social and cultural events from coast to coast and border to border, we have pivoted entirely and will instead be hosting a multi-faceted programme including a series of in-depth sectoral webinars.

      We are running high profile mainstream media and social campaigns this week too, to maximise the impact of St Patrick’s Day, raising the profile of Irish companies and of the Irish Advantage.

      None of us knows what the new normal will look like. We do know that it will not be a simple snapping back into the old ways. Over the past 12 months we have crossed the digital Rubicon. It is now up to all of us to embrace the digital opportunities on the other side. As Henry Ford said, “Whether you think you can, or whether you think you cannot, you are right”. We can.

       

      Join Enterprise Ireland USA for the ‘Ireland and the US: On Track to Getting Back’ virtual event on 16th March where senior business leaders from both sides of the Atlantic will discuss learnings from 2020, and powering growth in 2021. Register here.