Confidence is running high among local brands in latest PwC report
LOCAL brands including East Coast Bakehouse (Exporter of Year), Lakeshore, McDonnells, Hogan’s Farm and Avonmore Milk are just some of the major SMEs featured in the latest Love Irish Food/PwC Irish Food Barometer report. It reveals that 88% of Irish SME food companies expect revenue growth in 2020, and 96% confirmed capital investment plans for 2020; 10% said that this would be more than €3 million.
“The survey highlights optimism about the future growth potential for Irish food companies. They are also keen to seek operational efficiencies through innovation and technologies to improve margins, cost competitiveness and satisfied consumers,” said Grace McCullen, Senior Manager, PwC Ireland Retail & Consumer Practice, who hails from Bellewstown (right, with Kieran Rumley, Executive Director, Love Irish Food.)
“With the domestic market being the priority for growth prospects, expanding into new markets and new products should not be ignored. The UK will exit the EU at some point and that will give rise to new opportunities for manufacturing food products in Ireland that may have been supplied from the UK.”
The research shows that Irish SME food companies are optimistic about the growth prospects for their own businesses, but are less certain about the future performance of the economy.
With the vast majority focusing on the home market for growth, expansion into export markets is an area for potential development.
Just 16% are of the view that economic growth in Ireland will improve in the year ahead, 50% say it will remain unchanged and 34% say it will decline. As a small open economy, this is not surprising given external uncertainties and a softening in European and global growth.
“The survey highlights evidence of optimism amongst Irish SMEs around growth into 2020, notwithstanding a difficult trading environment,” says Kieran Rumley, Executive Director, Love Irish Food, the not-for-profit organisation established to help safeguard the future of Irish Food & Drink brands.
“There are considerable challenges in areas such as availability of skills across the board from operational, to technical to management – which in turn highlights the need for a greater take-up of available apprenticeships in the industry.”
With a price sensitive consumer, retailers’ opportunities to grow margins must now lie in the innovative use of emerging technologies to better understand shopping habits and to create brand loyalty.