More than half of top Irish food and drink SMEs anticipate a decline in sales revenues this year due to ongoing Covid-19 impacts on their businesses, according to research conducted by Love Irish Food.
The not-for-profit organisation, established in 2009 to help safeguard the future of Irish food and drink brands, found in a survey undertaken in Q2 and early Q3 of this year, that a third of its SME member brands expect sales to fall steeply (by more than 15%) in 2020, with 54% believe their sales value will be down overall while 41% of member brands expecting their business to be up, year on year, and with 5% seeing no change.
Almost half (44%) of the association’s SME members said the decline in sales will result in their businesses employing less staff as the industry emerges from the pandemic, with 46% expecting to retain the same level of staff and a further 10% expecting to increase employee numbers post Covid-19.
Separately, over half (51%) of Love Irish Food’s SME membership are experiencing greater short-term cash requirements than in 2019, an ongoing challenge for many who are struggling with narrow margins and cost competitiveness.
Despite the challenges curtailing growth prospects for many food and drink SMEs, 62% of Love Irish Food members believe 2021 will be a better year for their businesses than 2020.
Meanwhile, a significant cohort (46%) of respondents said they have experienced enhanced retailer support throughout the pandemic.
Kieran Rumley, Executive Director, Love Irish Food said: “The global health pandemic brought about by the spread of Covid-19 has been an unprecedented challenge for our industry and the scale of the issues we face continue to evolve at a significant pace. As a material contributor to our local and national economies, the Irish food industry faces significant uncertainty, not just as we emerge from the pandemic, but also in the face of Brexit. Irish branded food suppliers have worked hard to maintain continuity of supply to the retail trade and will continue to do so as it faces the prospect of a hard and complex Brexit. Maintaining food brands on shelf during this period will be a key challenge to the industry.
“In recent months Irish food brands are increasingly being supported by shoppers. Brexit will bring further complexity to an industry already over burdened by the Covid-19 fallout. Love Irish Food calls on Irish shoppers to continue to increase their support for locally produced food brands to ensure a strong, vibrant and independent food supply to Irish supermarket shelves at a vital point in our economic history.”