managing liquidity covid19

Managing liquidity through the Covid-19 crisis

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managing liquidity covid

Cash really is king for businesses contending with the Covid-19 crisis. Many of those still trading have to meet ongoing payroll, rent, utilities and other costs in the face of rapidly declining demand, while many others have been forced to close either as a result of government directive or adverse trading conditions and are looking at ways to reopen when the crisis abates.

The challenge for all of these companies is how to manage their liquidity through the coming weeks and months to ensure they are in a position to take advantage of the recovery when it does come.

Interestingly, recent events have served to prepare Irish companies for the shock. “We have been talking to a lot of companies in our role as an outsourced CFO,” says Barry Doyle, director of specialist financial advisory firm SGL.

“They have learned to deal with a lot of problems as a result of the Brexit crisis and they are better prepared as a result. With Brexit, the issues were reduced margins, foreign exchange issues and other disruptions, and they have been preparing for them.” says Doyle.

Of course, the scale of the impact of the Covid-19 crisis is greater by an order of magnitude. “This will mean a shutdown for many companies and a full loss of income for a sustained period,” Doyle points out. “They are seeing zero revenues on one hand while they face continued expenditure on staff, suppliers, customers and so on.”

 

Understand the Data with a Cashflow Forecast

Dealing with that situation begins with data. “The starting point is a detailed cashflow forecast,” Doyle advises. “That’s key to understanding where you are.” And what you need to do.

He describes cash and communication as the key elements of the approach to be taken once the forecast is complete.

“If working capital is the lifeblood of the business, cash is the oxygen,” he notes. “Companies have got to have working capital available to them to kickstart them after the shutdown.”

 

Engage with Creditors and Debtors

And that’s where the communication comes in. “You have to talk to your customers to identify what receipts are likely to come in. Are they still open? Are they still in a position to pay bills? Talk to your suppliers to see if they can extend credit to you. Part pay bills if necessary.”

Doyle says the best way for businesses to look at this situation is as akin to hibernation. “They have to squirrel away cash for when spring comes, so they can take advantage of the bounce that will come then. Many companies have seen this coming and have been working with their customers to get as much cash in as possible. Companies who haven’t done this should run an aged debtor analysis to see what might be out there. It might be a case of seeing who they can target for payment when business reopens, or it might be identifying customers to work with to find a way through the crisis.”

 

Wage Subsidy Scheme to Retain Staff

Cash will still be needed for payroll and other costs, of course. “Nothing is as important as your staff,” Doyle points out. “Your employees are a critical resource in business.”

He believes the Government Wage Subsidy Scheme can help companies avoid the damage of layoffs and advises them to avail of it where possible. “We are working with client companies to help them retain key staff and look after them during the crisis,” he adds.

 

Access Government Supports

Doyle’s Co-Director John Power describes the various State initiatives, including the Enterprise Ireland Stabilise and Rebuild Fund, Business Financial Planning Grant as a “huge boost”. Companies should monitor Government support developments and banking facilities offered from main banks and SBCI, to support their Working Capital needs to help them bounce back and restart their businesses quickly when working restrictions are eased

“The decision by Revenue to defer interest and penalties for late payment of VAT has also been very helpful,” he adds. “Revenue is not withholding Tax Clearance Certificates for late payment and that means companies will be able to continue to get paid by public bodies during the crisis.”

Power concludes by noting that businesses now have to become much more disciplined in terms of cost controls as well as in credit control. “In good times it is possible to be a bit more relaxed,” he says. “But companies now have to be a lot more disciplined when it comes to credit control. That means calling in debts as they fall due or even offering discounts to customers for early payment. They have got to build as much working capital as they can. Cash is king. That’s never been truer.”

Covid-19-An-Employer’s-Guide_

Covid-19: Know your responsibilities as an employer

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Employers and people managers around the country, especially those in small and medium-sized enterprises (SMEs) have legal obligations relating to the coronavirus crisis.

In conjunction with Enterprise Ireland, The HR Suite has produced ‘Covid-19: An Employer’s Guide’, a detailed document that outlines everything business owners and managers need to know about their responsibilities towards employees during this challenging time.

Caroline McEnery, Managing Director of the HR Suite says,

“Some of the relevant legislation is new and the changes in it are unchartered for both employers and employees. Other legislation was already in place, but most people wouldn’t have had to worry about it before so it wouldn’t have been on their radar.”

 

New legislative changes

The main points employers need to be aware of is emergency legislation introduced by the Government related to employee wages and payments.

Companies who can show their turnover has reduced by more than 25% due to Covid-19 may qualify for the Wage Subsidy Scheme. This provides a temporary wage subsidy of up to 85% of take home pay up to a maximum weekly amount of €410 per week to affected companies to help them continue to pay their employees.

Separately, employees who lose their jobs qualify for the new Covid-19 Pandemic Unemployment Payment of €350 a week for up to 12 weeks.

A new Illness Benefit, paid at the same rate, is also available — for two weeks to any employee medically required to self-isolate and for up to 10 weeks for any employee diagnosed with Covid-19.

“The good news is that the process of processing the payments and benefits is very  straightforward,” says McEnery. “It’s really important that you communicate all the above information as empathetically and sympathetically as you can to people who are already in a very emotional place.”

 

Relevant existing legislation

Among the older laws employees may now find relevant is the Redundancy Payments Acts 1967-2014. Under this act, people who are temporarily working fewer hours than they normally would can claim for a payment called Short Time Work Support. It is paid at the same level as Jobseeker’s Benefit (€203 a week), but on a pro rata basis for the days the person is not working.

Layoffs are also covered under the Redundancy Payments Acts. Employers can place employees on a period of temporary unpaid layoff if they believe they will be able to have them back in paid work again when the crisis passes. Employees who have been temporarily laid off qualify for the Covid-19 Pandemic Unemployment Payment, as outlined above.

“The only difference now is that if an employee were laid off previously, they could apply for redundancy after four weeks. That option is paused until the end of May [2020] and will be reviewed again then,” said McEnery.

 

Stay informed and communicate

With the Covid-19 situation remaining fluid, McEnery says employers should keep up to speed with what is happening and make sure their employees are in the loop too.

“Review your plans every two weeks in line with the latest Government and HSE guidance, while taking into account what is happening in your business,” she says, adding that employers should also make sure they keep communications channels open with their employees and make sure they are informed of any changes they should know about.

Download the ‘Covid-19: An Employer’s Guide’

Conor Fahy, Enterprise Ireland

Market Watch – A view from the Middle East, India and Africa

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The Middle East is expected to return to business sooner than Africa and India with the tech industry being the first to recover.

Key Takeaways

  • Companies need to closely monitor the changing business environment and be prepared to quickly pivot their offer or business model if the market demands.
  • Business is severely affected in the region even though the spread of the virus in Africa and India is weeks behind Europe.
  • Borders have been closed, international events cancelled, and most companies are looking to cut costs.
  • The Middle East is expected to return to business sooner than Africa and India with the tech industry being the first to recover.
  • Communication is vital for to maintain long term relationships.

 

The global pandemic has indeed affected every corner of the world and according to Conor Fahy, Regional Director, Enterprise Ireland, India, the Middle East, and Africa is no different.

“The area encompasses over 40% of the world population so lockdown and self-isolation presents many challenges,” says the regional director. “The situation in the Middle East is similar to Europe in timing and response and most companies are expecting a decrease in revenue and are looking to cut costs and consider cost containment and defer or pause investments.

“The double whammy of an oil price war and Covid-19 will affect budgets and Dubai has introduced highly restrictive measures, including closing its airport, so there is a risk of a sharp increase in business defaults and liquidations in the travel and tourism industry. Also borders have closed across the region and major international events have been cancelled or delayed.

“India and Africa are currently around three weeks behind in terms of cases and government response. But business is severely affected, while economic activity is suffering from the initial phases of lockdown. The medium-term impacts will be severe and combined with oil-price shock and reduced demand for commodities, the region is likely to tip into an economic contraction in 2020/21, in the absence of major fiscal stimulus.”

There are eight Enterprise Ireland offices across the region which are helping Irish companies stay informed, connected and exporting. And Fahy says it’s crucial for people to avail of this support and keep communications lines open in order to survive the challenges.

“We are providing in-depth customer engagement, virtual itineraries, bespoke buyer webinars and one-to-one advice and guidance,” says Fahy.

“Personal connection is vital to winning and retaining business so it’s essential to stay connected with existing customers. Be the trusted source of information: and proactively communicate with accurate market information and insights from your industry contacts, and from Enterprise Ireland’s Market Research Centre. When things get tough, the temptation is to become acutely focused on immediate problems but while these should be addressed, developing a strategy for recovery is just as vital. So extend your timeline assumptions and planning-against scenarios, even if it appears difficult. Now is the time to invest in strategic planning and to start thinking through decision criteria and conditions for return to business.”

Many organisations are still dealing with immediate concerns around the availability of cash.

While all sectors are being affected across the region, Tourism, Aviation, Construction, Industrial Manufacturing and Mining and Oil industries have been hardest hit but technology related businesses will be the first to make a recovery.

“CFOs in the Middle East are expecting to get back to normal sooner rather than later; pausing or delaying investments instead of cancelling them altogether,” he says. “In fact, the majority expect to return to business as usual within three months if Covid-19 were to end today.

“Investments in digital transformation, customer experience and cyber security are most likely to be protected as a result of Covid-19 and all indicators point to a technology-led recovery as AI is becoming pivotal in managing the huge amounts of data needed to deliver services and product.” said Fahy

While there are certainly challenges facing Irish exporters, Fahy says there are also some emerging opportunities, particularly for digital payments and cloud services.

“The near collapse of many online grocery retail platforms is driving demand for process automation and intelligent self-service and Irish companies quickly recognize the changing market dynamics,” he says. “But while positivity may be in short supply, there is optimism in around returning to business and continuing to invest where it matters.

“Business leaders need to invest time away from crisis management to show leadership and strategically look to future opportunities which will emerge when these economies rebound.”

Conor Fahy is Enterprise Ireland’s Regional Director of the Middle East, India and Africa. To learn more about the steps companies can take to address the impact of Covid-19 visit our business supports page.

Digital Tech

Market Watch Industry Bulletin – Digital Tech

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In the context of the ever evolving Covid-19 situation in which we find ourselves, Enterprise Ireland‘s digital technology companies are experiencing unprecedented changes in the market, facing extreme challenges but also unique opportunities as
they are forced to quickly adapt and thrive in a more virtual and digital reality.

In our bulletin, Enterprise Ireland’s market advisors provide insight on specific market developments, challenges and opportunities as well as some market specific Government supports and industry trends.

Read the bulletin here.

Market Watch Germany – Webinar – Impact on Supply Chain

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Enterprise Ireland’s offices in Germany have launched a series of Webinars: Market Watch Germany. Every Wednesday at 14:00 BST/15:00 CET a new theme will be addressed to help Irish companies exporting to Germany navigate the challenges and opportunities presented by Covid 19.

For the second webinar in the series on Wednesday 15th April, we were joined by Dr. Patrick Kim from BridgeBuilder.de and Dr. Gökhan Yüzgülec from Inverto GmbH.

This Webinar explores how to cut through the noise to stay reliably informed during the crisis, the impact on supply chains and procurement, and how to prepare for the shifts after Covid-19.

Market Watch Industry Bulletin – Automotive

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Download the bulletin here.

The global automotive industry faces an as of yet unseen level of disruption to its production capabilities. Companies along the supply chain are challenged by a drop in demand for vehicles and related products, fragmentation of international supply chains and production plant closures of most OEMs and Tiers. Markets are transforming at an unprecedented pace, with experts rushing to forecast the outcomes and offer solutions to the rapidly changing industry where necessary.

Enterprise Ireland’s first Automotive Industry Bulletin contains a summary of major developments, opportunities and challenges as well as relevant funding supports for each region. The assessment is based on the insights from Enterprise Ireland Global Market Advisors for the automotive industry.

Read the full report here.

Market Watch – Benelux

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The Market Watch bulletin for the Benelux region (Belgium, The Netherlands and Luxembourg) provides insights from Enterprise Ireland ’s market advisors across the region that may be helpful for your business, in the context of Covid-19.

Reporting from each Benelux market, in this edition we share information on travel to the markets and market specific government supports & initiatives.

Download the bulletin here.

Sean Davis

Market Watch – A view from North America

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North America, like the rest of the world, has been seriously impacted by the outbreak of COVID-19 and Sean Davis, Enterprise Ireland Regional Director of North America, says while there is no certainty in business at the moment, Irish exporters should seek to reassure their US customers.

 

Key Takeaways

  • The situation is changing daily but most states are operating on a work-from-home basis.
  • Travel and supply chain disrupted in many areas.
  • Irish exporters are advised to keep in contact with their North American clients, be aware of their situation and the need to communicate more personally via telephone or video link.
  • Business is still moving so Irish exporters are encouraged to adapt where possible and utilise time wisely in order to be ready for any business which should arise.

 

“It’s an evolving situation across North America but for the most part there are work-from -home requirements in most jurisdictions across both the US and Canada,” he says. “Travel is heavily restricted, and there is some supply chain disruption, also your customers are busily working to stabilize their own businesses. There is also uncertainty and fear of the unknown, along with customer cash flow disruption and in some cases contract negotiations frozen.

“With this in mind the focus of activity for Irish exporters should be around three pillars – stabilise, reset and recover, which in the immediate term, means stabilise. So staying close to customers and key strategic partners is vital, as is being aware of their situation, i.e. in addition to shared commercial challenges being able to connect by having an understanding of the specific impact of this crisis in their town or city is an important demonstration of empathy at a critical time

“We are seeing instances where contacts in some NA companies we are close to have been directly and profoundly affected personally by Covid-19, so again situational awareness is important and as much as possible communication needs to be via telephone or video conference as it is much more personal, empathetic and engaging.

“But brevity is key when it comes to the US and while many people are working from home, they are still time poor, so it’s important to keep things brief – to quote Franklin D. Roosevelt ‘Be sincere, be brief, be seated’.”

Davis says that the Reset and Recover phases will be more successful if companies use the stabilise period to accumulate as much market and customer intelligence as possible.

“This is an important time to identify where your company and product offering might have to pivot in order to be ready,” he advises.

“North America is an enormous economy, over $25TRN, and the US is the second largest single export market for Irish companies so despite the challenging times there will be huge market opportunity to develop as we recover and re-emerge. So any movement which demonstrates a willingness, where possible, to share some of the burden created by cash flow or credit terms is beneficial.” says Davis.

 

“But don’t over-extend your company’s credit terms either; this is a rapidly evolving situation and cash flow is crucial. Any Irish companies with an in-market presence and employing in the region, especially those with significant deployment, should be actively looking at what supports are being made available whether through economic stimulus packages or through funds available to support key sector strategic priorities within a country, state or province.”

Enterprise Ireland has seven offices across the region with teams ready to support their client companies throughout this journey.

“We have developed and completed a six-part webinar series called “Reliance and Adaptability in Extraordinary Times” led by a series of key opinion leaders in areas such as Leadership and Communication, Crisis Communication and Creating a New Narrative,” says Davis. “Our teams are working on a one-to-one basis with clients through key areas and deliverables. And for significantly impacted sectors, we have delivered, and are working on, other webinars bringing client companies and subject matter experts together.

“On a weekly basis, we are gathering market and sector intelligence which is being collated centrally in HQ and distributed via our colleagues in Ireland to client companies.”

While not all sectors are impacted equally, Davis says there are still  opportunities available and companies are still signing new business by solving problems, delivering innovation and fostering good partnerships

“Not everything has ground to a halt,” he says. “So I would advise companies  to pivot effectively, use our market research centre as it’s a prime time for under-utilised members of staff to build valuable market intelligence or look at opportunities in other North American geographies you have not previously considered.” 

“North America is a vast economic and geographical landscape which is likely to emerge from the current crisis in different stages and in different states (US) or provinces (Canada), hence some markets are likely to enter that Recover phase sooner than others and our network will be able to advise and support as this happens.”

Sean Davis is Enterprise Ireland’s Regional Director of North America. To learn more about the steps companies can take to address the impact of Covid-19 visit our business supports page.

shipping containers

Managing supply chain risk

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Global supply chains have been stretched to breaking point as a result of the COVID-19 pandemic. Enforced closures of companies, coupled with newly imposed border controls and other issues, have had a severe impact on many Irish businesses.

There are steps that can be taken to mitigate those effects, according to Shirlee Kelly, a strategic sourcing consultant with IDDEA, a strategic procurement consulting company.

“In Ireland, many companies rely on just-in-time delivery for the supply of goods and services, and the success of this strategy is dependent on highly integrated and efficient supply chains,” Kelly points out. “The availability of labour may impact on supply chains, while government actions may lead to delays in physically moving materials from location to location as well as at ports and across borders.”

As a first step, she advises businesses to assess their supply chain risks and identify those critical suppliers that can have a detrimental impact on the business. “Businesses should conduct a health check on their critical supply chains,” she says.

Start by looking at internal data.

  • Who are the high-spend, high-impact suppliers?

  • What are the immediate risks that you need to plan for?

  • How will you address any lack of supply?

  • What are the steps you need to take to ensure that you continue to meet your contractual obligations with customers?

Contingency Planning

The next step is contingency planning. “These plans may include, finding alternatives to normal supply routes, investing time in discovering and conditioning new suppliers,” Kelly advises. “Companies may need to change their sourcing strategies to include a more local approach. If companies are dependent on one supplier, they need to put measures in place to make sure they have sufficient stock and ensure business continuance. It is important for businesses of all sizes to build resilience across their supply channels and keep their key customers informed of the work they are doing to meet demand.”

Good supplier management is essential in order to reduce the potential impacts of supply chain disruption. “You may have 500 suppliers, so it is not possible to manage every supplier in the same way,” Kelly notes. “We use the Kraljic Matrix to categorise suppliers by the value you spend with them and the risk they pose to your ongoing operations.”

This matrix reveals those suppliers who are strategically important by evaluating them against their value to the bottom line and the risks of a disruption affecting their performance. High-value, high-risk suppliers clearly need careful management, as indeed do those in the low-value, high-risk quadrant who are defined as bottlenecks.

Supplier management begins with information.

“Capture all appropriate data about your critical suppliers, and use this information to drive value for your organisation.  Using tools such as Porters Five Forces and PESTEL analysis as part of your market research, will allow you to assess and evaluate the external factors which may affect your industry and business operations.” says Kelly.

The data analysed, and the knowledge gained, forms the basis of your supplier performance management. “Ensure you have a scorecard in place to allow you measure supplier performance? What metrics do you use and are they aligned with what you are trying to achieve in your overall business strategy?”

“It is important that strategic suppliers work with you on risk management strategies,” she adds.

Those risk management plans should be based on four key elements – awareness, impact, mitigation, and contingency planning.

“Awareness is about understanding the probability and potential impact of the risk,” Kelly explains. “The goal of risk management is to recognise, reduce or mitigate the likelihood of risk. The objective is to identify procedures for managing all stages of risk, this includes, disruption – interruption, response, recovery and restoration of service.

She concludes by pointing out that doing nothing is not an option.  “Companies need to act now, investigate the opportunities in your data, identify your key supply partners and work together on problem resolution.  Treat key suppliers as an extension of the business and find out how you can support each other. Irish businesses are very good at working together in difficult times.  Government bodies such as Enterprise Ireland are a great resource for information on the various supports available to Irish businesses.  The companies I am currently working with are sharing information with their supply base and this is helping to ease supply chain problems.”

man applying for funds

Support when it’s needed most

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The Department of Employment Affairs and Social Protection (DEASP) has launched a range of supports for employers and people who have lost work and income in order to support them during the COVID-19 crisis. These include the COVID-19 Pandemic Unemployment Payment and the Enhanced Illness Benefit Payment.

 

Pandemic Unemployment Support

The COVID-19 Pandemic Unemployment Payment is an emergency payment of €350 per week introduced by the Government in response to the numbers of people who have lost employment on foot of the pandemic. It is designed to quickly get thousands of people into payment.

According to the DEASP, all workers, including the self-employed, are eligible to apply for this emergency payment provided they are aged between 18 and 66 and have lost employment – or temporarily ceased trading if self-employed – due to the pandemic, and live in the Republic of Ireland.

To be eligible, workers must have been in employment or self-employment immediately before Friday 13 March and have been temporarily laid off from work, and are not in receipt of any employment income. For employees, their employer must not be in a position to retain them on the payroll.

 

Apply online for quick payment

The quickest and easiest way to apply for the emergency COVID-19 payment is to apply online at MyWelfare.ie All that is required is for the individual to have an email address, a bank account and a PPSN. Simply go onto the COVID-19 Services section of the website and apply for the payment. You will have to set up an account, but it is a simple and straightforward process.

The DEASP advises those with an adult dependent and one or more dependent children to apply for the Covid-19 Pandemic Unemployment Payment and then apply Jobseeker’s Benefit instead, as this will pay more than the €350 available under the COVID-19 scheme.

 

Enhanced Illness Benefit Payment

The Enhanced Illness Benefit Payment is available to workers who have been told to self-isolate by a doctor or the HSE, or have been diagnosed with COVID-19 by a doctor. To be eligible for this payment, a person must be confined to their home or a medical facility. The rate for this payment is €350, as compared with the normal Illness Benefit rate of €203. It will be paid for a maximum of two weeks where a person is self-isolating and for a maximum of 10 weeks if a person has been diagnosed with COVID-19.

A doctor will complete a medical certificate on the person’s behalf and send it directly to the DEASP. Alternatively, where the person has been advised by the HSE to self-isolate, they will need to submit a copy of the HSE notification with their Illness Benefit application form.

Once again, the quickest and easiest way to apply for the payment is by applying online at MyWelfare.ie

 

Short Time Work Support

Another payment available to workers is Short Time Work Support. This is a form of Jobseeker’s Benefit for people temporarily placed on a shorter working week. The payment is made in respect of the person’s regular salary for the days that they are no longer working. For example, if their working week has been reduced from a five-day work pattern to three days, they can receive support for the other two days. Payment is proportionate to the €203 Jobseeker’s Benefit rate.

People can apply for Short Time Work Support by applying at their local Intreo Centre or Social Welfare Branch Office.

 

Temporary Covid-19 Wage Subsidy Scheme

Operated by Revenue, the Temporary Covid-19 Wage Subsidy Scheme is an innovative initiative to support companies to retain employees and to re-employ employees who have been laid off due to the COVID-19 pandemic. Under the terms of the scheme, employers will be refunded 70% of an employee’s wages – up to a level of €410 per week.

The subsidy scheme applies both to employers who top up employees’ wages and those who aren’t in a position to do so. Employers make the support payment to their employees through their normal payroll process and will then be reimbursed by Revenue within two working days of receipt of the payroll submission.

The scheme is available to employers from all sectors (excluding the public service and non-commercial semi-state sector) whose business activities are being adversely impacted by the COVID-19 pandemic.

To qualify for the scheme, employers must be experiencing significant negative economic disruption due to the COVID-19 pandemic; be able to demonstrate, to the satisfaction of Revenue, a minimum of a 25% decline in turnover; be unable to pay normal wages and normal outgoings fully; and retain their employees on the payroll.

Revenue has made it clear that declarations made under the scheme are not declarations of insolvency.

Employers wishing to register for the scheme can apply to Revenue through ROS myEnquiries on the COVID-19: Temporary Covid-19 Wage Subsidy section.

Market Watch Germany – Webinar – Covid-19 challenges and market sentiment

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Market View Germany

Enterprise Ireland’s offices in Germany have launched a series of Webinars; Market Watch Germany, to help Irish companies exporting to Germany navigate the challenges and opportunities presented by Covid 19.

The first webinar on Friday April 3 looked at overall market sentiment and the German Government support package for companies facing acute difficulties in light of Covid-19. We were joined by market, legal and tax experts from Germany Trade & Invest, SHWP Tax & Law and MHL Law.

 

Marina Donohoe

Market Watch – A view from the UK, Central & Northern Europe

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There is no doubt that COVID-19 is making its presence felt with businesses across the globe feeling its impact and Marina Donohoe, Regional Director, UK, Central and Northern Europe, says Enterprise Ireland clients in the region are no different.

 

Key Takeaways:

  • Great uncertainty on how deep the recession might be and its length makes it a particularly challenging time for Irish industry. 
  • Restriction of movement is causing further issues for Irish exporters.
  • Prepare for the upturn – invest in client and partner relationships to secure existing business and research potential new opportunities to emerge now and post the crisis.

 

“Restrictions on movement of people is impacting on clients’ ability to respond to customer and partner needs,” says Donohoe. “Market confidence and demand has been eroded, and deals are being lost while fund raising plans have been curtailed or stalled. There is great uncertainty on how deep the recession will be and how long it will last, and this makes for a particularly challenging time for Irish industry.

“Enterprise Ireland has eight offices across the region which are working closely with clients on a one-to-one basis to support them throughout this difficult period focusing on sustaining existing and securing new business where possible.” says Donohoe.

 

Strengthening partnerships

Donohoe says it’s vital for companies to stay connected by keeping abreast of what is going on, exploring the possibilities of virtual business and continuing to invest in client/partner relationships.

“It’s a time to listen and learn about the problems your clients are experiencing and how together you may find potential solutions which strengthen your partnership,” she says. “But also, it’s important to exercise caution when extending credit, especially when your business partners are relatively new, and you’re not familiar with their current liquidity position.

“So, I would encourage companies to actively research the marketing issues their clients are facing, seek out information on the current situation from trusted sources like the WHO or local government departments. And continue to invest in marketing because while industries globally are in crisis mode, they are still seeking solutions to trade so with heavy restrictions on travel, focus on virtual meetings and as a means of engaging prospective new customers.”

 

Global supports for business

While it is undoubtedly a difficult time in business, the regional director says there have been many supports put in place across UK, Central & Northern Europe and Russia.

“A variety of measures have been adopted by the British and other European governments,” she says. “Each country is offering a range of specific supports including loans, wage subsidies or guarantees and these may be relevant for Irish companies with a presence overseas. OECD provides a regularly updated Country Policy Tracker to help navigate the global policy response and provides information on travel, border crossings and general health advice.

 

Key sectors facing challenges

“Many sectors are severely impacted such as the tourism and hospitality trade, personal and professional services and certain areas of the financial and manufacturing sectors.

“Transport is also a major concern and although some countries (e.g. UK and Sweden) have not closed their borders, many others have created temporary regimes which are causing problems for road deliveries – logistics details can be found here.

With all these added complications, doing business can be difficult for Irish exporters and Enterprise Ireland is currently preparing sectoral market insights which will be shared with clients and updated weekly to provide view on market conditions, government supports etc.  Details on public sector contracts and offers can be seen on this platform and also on the GOV.UK site.

 

Opportunities for growth

Donohoe also says there are still opportunities for growth but in a few core sectors:

“The healthcare, pharma, digital services and medical device sectors are still experiencing growth and Enterprise Ireland has been fielding requests for solutions in this area,” she says. “Similarly, solution providers for retail, BPOs, food production and office solutions may also see some growth.” 

“As markets and sectors emerge from this crisis with expected fundamental shifts in consumer/business needs it is a time to also prepare for these changes. Ireland’s SMEs have demonstrated resilience and flexibility by adapting to Brexit challenges and a global recession so remaining agile will be an advantage”.

No-one knows when the crisis will be over, but Donohoe says it’s vital for Irish exporters to stay connected and prepare for the reopening of markets.

“Utilise all digital tools to deepen relationships and promote your business,” she advises. “Prepare for the upturn to secure existing business and research potential new opportunities to emerge now and post the crisis.

“Business and consumer demand will change so investment in research, new idea validation, competitor analysis and the development of strong market development plans will all position Enterprise Ireland clients for the next global economic growth cycle.  Enterprise Ireland’s executives across the 8 offices in UK, Central & Northern Europe are on hand to support you through this exceptionally difficult and unprecedented period.”

Marina Donohoe is Enterprise Ireland’s Regional Director for the UK, Central and Northern Europe. To learn more about the steps companies can take to address the impact of Covid-19 visit our business supports page.