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Small business association warns 2023 budget must tackle cost of doing business in Ireland General, Ireland, news for Ireland, Ireland,

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The Small Firms Association (SFA) today released a report which looks at the cost of doing business in 2022 for the Irish small business community.


The report finds that the total average cost of doing business for all small (20-49 employees) micro (less than 10 employees) businesses is €138,814 per month. The average for micro enterprises is €66,426 and €193,535 for small enterprises. On average, labor costs represent 82% of the company’s total monthly costs. Bank and other charges (5.6%) come second, followed by transportation/insurance (5.1%), all property charges (4.9%) and all utility charges (2. 4%).


Additionally, half (52%) of all businesses with less than 50 employees currently manage debt. Bank loans (63%), other financing loans (28%) and tax debt (22%) are the three main forms of corporate debt.


The average debt for micro and small enterprises is €80,903, the lowest for micro enterprises at €56,774 and the highest for small enterprises at €107,149. The report finds that rising business costs are the biggest challenge facing small businesses.


For small businesses with rental or lease costs, more than half (55%) either had a rent increase or were approached by their landlord about a need for a rent increase. Small businesses are under pressure to increase employee wages (56%), provide additional employee benefits (26%) and more support for remote work (18%).


In Budget 2023, the SFA is calling for measures to support staff retention and development to help small businesses survive these difficult times. The association wants capital gains tax to be reduced to 20% and the lifetime cap of CGT Entrepreneur Relief to be raised to €15 million and increased investment in digitalisation, business practices. he circular economy and energy security enable the transition to a green economy.


Speaking at the launch of the report, SFA Director Sven Spollen-Behrens said: “Irish micro and small businesses face cost challenges across all areas of business, whether covers labour, transportation, insurance, banking and utilities. Many operate with a low margin. environments, making it difficult for them to absorb cost increases and the demand for value making it impossible for many to pass on the increase to customers. »


He added: “At a time of high inflation and relentlessly rising input prices, especially energy prices, the SFA is concerned that this could lead to the closure of viable businesses due to their inability to absorb rising trade costs. To avoid this and protect our national businesses, Budget 2023 must provide cost certainty and maintain competitiveness. »


Source: www.businessworld.ie