of Enterprise Ireland looks at the success of Irish firms employing 106,000 people in the US.
Exports from Ireland to the US now stand at a value of €3.7 billion, a figure that is confidently expected to rise, says Sean Davis, Enterprise Ireland’s regional director for North America.
Over the last four years exports from this country to the US have grown steadily — in fact, over the last three years alone, exports from Ireland to the US have grown by a very steady 11% annually.
With more than 900 Irish companies exporting to the US and with some 600 firms deployed all over the continent, Irish foreign direct investment into the US is worth an eye-watering $146 billion — making us the ninth largest source of FDI into the United States of America.
“This figure is quite staggering for a country of this size,” observes Davis, who points out that this figure represents Irish-origin or indigenous companies which are deploying resources and facilities into the USD.
“These figures come from the US Bureau of Economic Analysis, a fact which further serves to underline the validity of our success in the USA,” he said.
“What that means, in real terms, is that there are Irish companies located in all 50 states and employing 106,000 people in the US.”
It goes without saying then that the international relationship between both countries, is, as he puts it, very much “a win-win for both sides”.
Given the uncertainty which remains around Brexit, there is a necessity for Irish companies to deploy into major international markets, specifically the USA.
To put it in context, the US economy is worth in the region of $22 trillion.
Davis puts it in context: “The economy of the State of California alone is equivalent to the UK economy.
"Texas is equivalent to Canada and New York is equivalent to South Korea — and that in a nutshell explains why Irish companies really need to deploy to the USA.
“If you look at the US economy only 30% of its GDP is exported, so 70% of their GDP is generated in the country,” he remarked.
Davis, who has mostly lived in the USA since about the mid-1990s, says the sheer economic size of the US market is the single biggest reason why Irish firms should think about deploying there.
“It takes as long to get to New York from Ireland as it does to go from New York to San Francisco,” he says. And, in this context, he has a word of warning.
Vital advice on companies entering the US market
Irish companies who are considering exporting to the USA must be extremely focused and strategic in their approach.
“You have to pick the geography that makes sense. It should be a geo-centric location within a reasonable proximity to a large number of potential customers,” he advises, adding that any business that tries to “go coast-to-coast” in terms of exports will quickly find the experiencing wearing thin: “If you try to go coast to coast it will wear you out financially and physically and it will wear out your bank balance too.
The USA is such a vast economy and such a vast country that if you’re planning to deploy there, it must be done in a very strategic and targeted way.
Effort and investment should be put into plenty of advance research, he counsels, adding that Enterprise Ireland’s up-to-the-minute online market research tool should be the very first port of call for Enterprise Ireland companies considering exporting to the USA for the first time.
“This plays a key part in giving companies the opportunity to validate any assumptions they may have about their market opportunities in the US — or not as the case may be.”
On the ground, Enterprise Ireland, as Davis explains, basically spans all the major industry sectors apart from food, which is, of course, the responsibility of Bord Bia: “We have 36 people on the team here and we have offices in New York, Boston, Austin, Chicago and San Francisco and Seattle.”
Second Enterprise Ireland office opening in Canada
Enterprise Ireland is opening its second office in Montreal, Canada, within the next six to eight weeks.
It’s a ‘big’ presence, Sean Davis acknowledges, but there’s a well-thought-out strategy behind it.
“There has been a very significant expansion over the last few years because of Brexit realities,” he said.
One Enterprise Ireland strategy has been to offer its client companies market diversification opportunities in the US.
“The USA is actually the second largest single market for Enterprise Ireland clients companies after the UK,” Sean said.
“We’ve spent the past three years preparing companies for this. Our view is that any work spent on developing alternative market opportunities is time well spent.”
The key point is realising the simple truth that — for most companies — having all their eggs in one basket is not a good idea.
“Thus, it has been a key focus for Enterprise Ireland to offer market diversification opportunities.”
And, of course, the USA is also very important to the Irish business sector because of its sheer accessibility in terms of the number of direct flights from Ireland to cities like New York, Boston, Chicago, Atlanta, San Francisco, LA, Seattle, Philadelphia, Orlando and Miami.
“What you have is a multiple airlines crossing the Atlantic on a daily basis to major hub airports — and there is also transfer capability into anywhere in the country,” Davis points out.
“That is hugely important form the point of view of people travelling across the Atlantic — that connectivity is a really significant factor,” he says, adding that companies which have notched up significant successes in the USA in the past include the IT solution firm Teamwork, from Cork, which has offices in Boston and Modular Automation, a Co Clare company with a base in Florida.
On another note, as he points out, from an economic impact perspective, Irish higher education institutes attract large numbers of US students to study here — Enterprise Ireland runs the Education in Ireland programme in the US which promotes Ireland as a desirable study destination.
Outside all of this, it’s interesting to know that on any given day, week or month, Enterprise Ireland is working actively with 500 Irish companies who are exporting to the USA.
“That’s a figure that we plan to grow significantly as part of our diversification strategy,” says Sean Davis, who is clearly a man who loves his job.
“When we work with companies here, whether they’re just coming in to the US market, or are very established, we’re re always looking for ways to impact these companies positively and to help them scale up and grow — it’s extremely gratifying!”