OpenSky, the Irish GovTech transformation specialist which provides process automated solutions to public sector bodies, has partnered with UiPath, the leading enterprise Robotic Process Automation (RPA) software company. Through this strategic partnership, OpenSky will design, develop and implement cutting-edge RPA solutions for public sector bodies and government agencies in Ireland.
Leveraging robotic automation and Artificial Intelligence (AI), OpenSky will provide automated solutions that enable organisations to maximise efficiency – up to 80% of organisations using RPA have experienced significant increases in business process efficiency*.
These solutions will also help to reduce operational costs and free up resources, enabling employees to work on more customer-focused and business critical tasks, as opposed to menial jobs.
The collaborative venture will also help Irish public sector organisations to enhance the citizen experience by making services more accessible via online portals and digital touchpoints. This digitisation of core services also means improved responsiveness and better value for the public.
UiPath has a 400,000-strong developer community and a customer base of more than 2,800 customers, including 50% of the top 20 Fortune Global 500 companies. Leading the ‘Automation First’ era and championing one robot for every person, UiPath brings digital skills to more than a million people, with its Enterprise RPA Platform already automating millions of repetitive tasks for businesses and government organisations all over the world.
UiPath’s Enterprise RPA Platform is an end-to-end, high-performance solution that facilitates robotic process automation. OpenSky will customise, implement and support it within Irish public sector organisations to create digital, integrated ecosystems; helping to save time and expense, and improving data quality and compliance.
Meanwhile, OpenSky has delivered major projects for leading government organisations which impact 2.5 million people every day. Its new partnership with UiPath ties in with the company’s wider plans to maintain revenue growth, increase staff numbers and expand further in international markets.
Michael Cronin, Managing Director, OpenSky, said: “It’s great to work with such a valuable partner and world leader in terms of RPA. UiPath is helping us to innovate and deliver cutting edge solutions for our clients. We pride ourselves on bringing valuable technology to the market that makes an impact for government organisations, not only for those who work within these organisations but for Irish citizens as well.
“Together with UiPath, we are enabling government digital strategy to produce successful outcomes, transform the way in which they work and improve access to services for the general public. Through automation and RPA technologies, we can boost productivity, experience and satisfaction for everyone involved.”
Jan Ursi, VP of Partnerships for EMEA at UiPath, said: “Ever since our early days, we at UiPath have made it our mission to empower organisations and their staff to take back control over their time by relegating those repetitive, time-consuming, menial tasks to a digital workforce made up of software robots. Via this partnership, we get to witness technology at work bringing more efficiency to the public sector and freeing up critical human resources that can better focus on increasing citizen experience and ultimately channel their efforts on making our cities a better place to live.”
* Source: The Impact of RPA on Employee Experience; Forrester survey, August 2018
Pictured at OpenSky’s offices in Naas, County Kildare, are (l-r): William Flanagan, Commercial and Technology Director, OpenSky; and Michael Cronin, Managing Director, OpenSky.
AxFlow Holding, the international fluid handling group that is active in all European markets, South Africa, Australia, and New Zealand, has acquired the Irish Induchem Group, the specialist provider of fluid handling solutions, which predominately focuses on valves, pipe solutions, mixers and pneumatics. Headquartered in Cork, the Induchem Group has four sites, located in Ireland and the UK; two service centres and two sales offices. The acquisition will see Induchem continuing to operate as a separate company under its brand.
The Induchem Group started out as a focused distributor of steam traps and pipe support solutions in 1982. It later expanded its product offering and changed focus from distribution to becoming a technical solution provider in its sectors by developing expertise and growing service capabilities. Today, Induchem serves a wide range of market segments with the majority of customers being in pharma, power generation, chemicals, petrochemical, food, design and engineering.
The Induchem Group divides its business into two main sources of revenue: investment driven projects (both green and brown field investments) as well as maintenance repair operations (MRO). Its product offering comprises a wide range of industrial valves, high purity products, lined pipes, valves and accessories, mixer solutions, PD and vacuum pumps, as well as air, compressor and pneumatics. In the aftermarket and MRO, its focus is on high purity, pneumatics, instrumentation, engineered services, process and corrosion resistance.
Announcing the development Ole Weiner, CEO of AxFlow Holding, said: “The acquisition is in line with AxFlow Group’s strategy of adding valves to its existing positive displacement pump portfolio with the aim of having the capabilities to build larger systems, to extend the service support and grow its geographical presence in existing markets. Induchem has long-standing relationships with leading international valve and process equipment manufacturers and this will open up future expansion opportunities for other AxFlow distribution companies in Europe.” He continued:“Induchem and the AxFlow Group have several similarities, not least of these being that they are family businesses. Induchem’s owner and Managing Director David Carroll is the second generation in the company and has grown up with the company, whilst AxFlow is part of Axel Johnson Group a 5th generation family business.”
Commenting on the acquisition David Carroll said: “The acquisition provides potential synergies from significant opportunities with our existing supply chain and the introduction of new suppliers and expansion of the fluid handling offering. Induchem’s Irish and UK entity complements AxFlow existing business very well with regards to market industry segments, regional presence, service offering and product offering.”
AxFlow Ireland’s Managing Director Stuart Flood is equally enthusiastic, saying: “This significant development will enable us to offer an unrivalled range of products and services to the marketplace therefore adding value and real benefits to our customers.”
Dublin-based mobile technology business, Xtremepush, has become the first Irish-owned tech firm to earn a place on the Gartner Magic Quadrant for Mobile Marketing Platforms. Established in 2014 by tech entrepreneur Tommy Kearns and Dr Kevin Collins, the business has become a leading global provider of customer engagement channels, marketing automation tools and analytics software, now operating eight offices in the UK, the US, Ukraine and Eastern Europe.
The Magic Quadrant is a research methodology evaluating the most relevant and compelling business offerings on the market, spanning a range of services and industries.
This latest Mobile Marketing Platforms report particularly recommends marketers in digital commerce, travel and hospitality, financial services and online gambling consider Xtremepush.
Tommy Kearns (pictured left), CEO of Xtremepush, says the business is delighted to be prominently positioned in this year’s Magic Quadrant, with an offering that represents the next generation of multichannel engagement solutions. “It is particularly pleasing to be praised for our real-time analytics and communications, as well as the scalability and ease of use of the platform. These are three crucial aspects of our offering. The report also testifies to our cross-channel capabilities, which we know from clients is a huge differentiator for us. Unlike some other vendors mentioned, we are strong across all digital channels, not just mobile, including web browser, SMS, email and social messengers.”
With leading enterprises relying on the Gartner Magic Quadrant to make informed choices when choosing service providers, its publication represents a major boost for the Dublin headquartered tech firm.
The mobile marketing solutions report evaluates firms against strenuous criteria including functionality, analytics, mobile engagement techniques and marketing optimisation, as well as advanced capabilities and the business’s overall market momentum.
Each report is written by a team of market analysts who closely monitor emerging trends.
In total, 18 different vendors are assessed in the 2019 report, with many more having been evaluated but failing to meet criteria.
CTO of Xtremepush, Kevin Collins (pictured right) says inclusion in the 2019 Gartner Magic Quadrant for Mobile Marketing Platforms reflects the swift progress the young company has made on its business expansion roadmap. “Our rapid growth is due to the profound effect our solution is having on forward-thinking brands around the world. We consider ourselves to be strategic partners, and work closely with clients to consolidate their engagement channels, unify the data silos and deliver exceptional customer experiences.”
Xtremepush has grown significantly year on year since its incorporation, adding a multitude of high-profile brands across every vertical to its portfolio of global clients.
New clients in the last year include the DAA, Oddschecker, Wirecard and SportPesa. The business has had 100% year on year new business growth for the past three years, and similar organic growth across its portfolio of financial, gaming, travel, leisure, e-commerce, retail and publishing clients.
It also actively looks for acquisition targets globally to complement the platform solution. In 2018, Xtremepush successfully acquired Emailcenter, a leading email service provider in U.K. The Gartner report notes this was a shrewd move, “bolstering its already robust support for all major mobile and web message techniques”.
The company has been aggressively expanding its European presence over the past 12 months, opening new offices in Poland, Turkey, Romania and the Czech Republic in addition to its UK base and Irish HQ. It has also recently launched an office in the U.S.
Innovation Zed, an Irish medtech company, has signed a global partnership and data integration agreement with SIRMA Medical Systems. As a result of this new partnership the companies will pursue joint efforts to promote and sell their products as a single integrated system to improve health outcomes for people with diabetes.
Innovation Zed, headquartered at NovaUCD, the Centre for New Ventures and Entrepreneurs at University College Dublin, was co-founded by William Cirillo and John Hughes. SIRMA Medical Systems is a division of SIRMA Group, one of the largest privately-owned Bulgarian IT Groups.
Last year Innovation Zed, launched InsulCheck Connect, an insulin pen add-on technology which automatically collects essential usage data that informs insulin pen users of their injection history. When paired with a Bluetooth® enabled device, the end-user can view behavioural analysis on their choice of diabetes management applications.
SIRMA Medical Systems is a leading company in software applications and integrated platforms for e-Health. Its mobile application Diabetes:M is among the most popular applications for both Android and iOS devices, with more than 350,000 installations and 50,000+ active users.
Currently, adherence to insulin therapy is one of the most difficult aspects of diabetes treatment. A simple focus on motivating users to increase adherence to their daily injection schedule can potentially improve their long-term glucose control (HbA1c). Such improvements can assist in reducing the likelihood of developing diabetes related complications.
“Now that our InsulCheck Connect technology is incorporated with the Diabetes:M platform, we can empower existing platform users, and entice new users to adopt this technology ecosystem with aims to improve adherence and their diabetes treatment,” said Dean Minnock, Director of Business Development, Innovation Zed. “Our products are designed to enable and drive those improvements and combining an advanced data management system such as Diabetes:M platform makes reaching optimum therapy attainable.”
Rossen Varbanov, CEO, SIRMA Medical Systems, said: “This global partnership is yet another cornerstone in our strategy to bring quality diabetes management to a wider audience. Therapy adherence is a serious issue and we are dedicated to making a cumbersome task as easy as it could be. The unique features for insulin pen users in Diabetes:M are designed to both save time and allow them to do things, otherwise only available to pump users.”
“We believe the option to calculate and set reminders for split extended bolus and the automated processes that a Bluetooth® connected pen allows will be of great benefit to owners of Innovation Zed’s InsulCheck Connect.”
Innovation Zed is an Enterprise Ireland high-potential start-up (HPSU) company.
Pictured at NovaUCD are William Cirillo and John Hughes, co-founders of Innovation Zed.
Toast, the fastest-growing restaurant management platform in the US, has opened its new office in Dublin and officially announced plans to grow its headcount by adding 120 new roles focused on new product development for the company. The Irish site is the company’s first international technology and product development centre globally and was first established in 2017. Since then, the team has grown to over 40 staff members across engineering, development and support roles.
The new office based in Ballast House on Westmoreland Street accommodates over 200 people. Toast is now hiring new recruits in software engineering, data analytics, product design and software development. The company is supported by the Irish Government through IDA Ireland.
Launched in 2013, Toast powers successful restaurants of all sizes with a technology platform that combines restaurant POS, front of house, back of house and guest-facing technology with a diverse marketplace of third-party applications.
Commenting on his visit Dublin for the official opening, Hugh Scandrett, Senior Vice President of Engineering, said: “The response to placing our first international office in Dublin has been positive and we look forward to growing our presence here. I look forward to expanding our team with talented people and developing products that will be central to Toast’s growth in the coming years. Dublin is a recognised technology hub in Europe which makes it the right location for our investment in this great new office.”
Mary Buckley, Executive Director of IDA Ireland, commented: “IDA is delighted to support the growth plans for Toast in Dublin and welcomes the additional R&D investment for the technology ecosystem in Ireland. High growth international companies continue to be attracted to Ireland due to the ease of access to a talented workforce.”
Interested candidates may find additional information on Toast career opportunities here.
Beth Choulas, Director of Real Estate & Workplace Experience at Toast; Mary Buckley, IDA; and Hugh Scandrett, Snr VP of Toast.
Stryker, one of the world’s leading medical technology companies, has announced the opening of its Digital Platform Services Centre of Excellence in Dublin, Ireland, and a strategic collaboration with RCSI (Royal College of Surgeons in Ireland) to develop digital solutions for use in emergency and specialist care settings to provide more seamless care coordination for patients suffering from time critical medical emergencies.
Stryker will locate its Digital Platform Services Innovation and Ideation Hub in RCSI’s Smurfit Educational and Research Centre, located on the Beaumont Hospital campus. The collaboration will focus on developing digitally enabled care products and performance metrics to deliver better patient outcomes. These tools will benefit patients by improving access to consistent, high quality care, and provide healthcare providers with more accurate information to better inform resource deployment.
“RCSI has a proud legacy of over 230 years of clinical innovation as well as unrivalled expertise in surgical training and practice,” said Prof Cathal Kelly, RCSI CEO. “Today, our dynamic research culture has a global reach, driving discoveries and innovations that enhance patient care and outcomes. Engaging with industry is an integral part of our research culture and partnerships, such as the one announced today with Stryker, are vitally important to delivering on our mission to improve human health and patient outcomes on a global scale.”
“We recognize the importance of being deeply connected to healthcare professionals to understand their challenges and gather insights to develop solutions that drive value and improve patient outcomes,” said Shaun Braun, Vice President of Digital Platform Services at Stryker. “This partnership will enable knowledge sharing and ensure we are grounded in clinical reality as we build digital products that make a difference for our customers and their patients.”
The European Securities and Markets Authority (ESMA), the EU’s securities markets’ regulator, has published a report on the status of licencing regimes of FinTech firms across the European Union (EU). The report is based on two surveys conducted by ESMA since January 2018, which gathered evidence from national competent authorities (NCAs) on the licensing regimes of FinTech firms in their jurisdictions.
The first survey conducted in January 2018, sought to identify potential gaps and issues in the existing EU regulatory framework, assess how the existing national regimes diverge and, if identified, propose recommendations to adapt EU legislation to the emerging innovations. The second, launched in January 2019 attempted to identify the ways in which NCAs employed the concepts of ‘proportionality’ and ‘flexibility’ when licensing FinTech firms.
The Surveys confirmed that NCAs do not typically distinguish between FinTech and traditional business models in their authorisation and licensing activities since they authorise a financial activity and not a technology. ESMA’s key findings from the surveys are:
1. The primary area where regulatory gaps and issues have been identified by NCAs and where FinTech firms do not fit neatly within the existing rules is related to crypto- assets, ICOs and DLT. NCAs called for more clarity at the EU level with respect to the definition of financial instruments and the legal nature of crypto-assets. The NCAs’ responses served to confirm ESMA’s Crypto Asset Advice that certain tokens are financial instruments and subject to the full attendant regulation, while those tokens that are not deemed financial instruments should be subject to some minimal level of regulation;
2. The Surveys also identified the need for greater clarity around the governance and risk management processes associated with both cyber security and cloud outsourcing. The Joint ESA Advice on the need for legislative improvements relating to Information and Communication Technology risk management requirements in the EU financial sector and the Joint ESA Advice on the costs and benefits of a coherent cyber resilience testing framework for significant market participants and infrastructures within the EU financial sector address many of these issues;
3. There is a direct link and interdependencies between the innovation facilitators and authorising approaches for innovative FinTech business models. Innovation facilitators play a central role in mapping approaches applied to FinTech and in identifying the areas where the legislation and licensing requirements need changes and adaptation. Moreover, innovation facilitators, especially regulatory sandboxes, may have an impact on the licensing regime for FinTechs and may allow for divergence from other jurisdictions. In response, ESMA jointly with the EBA and EIOPA published the Report on FinTech: Regulatory Sandboxes and Innovation Hubs in January 2019 . In addition, the European Forum of Innovation Facilitators established in April 2019 aims at fostering convergence in this area;
4. Finally, there is an ongoing discussion as to the need for an EU wide holistic crowdfunding regime, particularly for crowdfunding based on non-MiFID II instruments. The regulation of crowdfunding service providers is under scrutiny by the European Parliament and the Council and is expected to facilitate a the level playing field for cross-border service providers.
The Report addresses one of the five action points of the European Commission FinTech Action plan, namely ESMA’s mandate ‘to map current authorising and licensing approaches for innovative FinTech business models in Europe’.
ESMA concludes that, based on the evidence gathered, that at present most innovative business models can operate within the existing EU rules, and reinforces its conclusions made in the recent reports on crypto-assets/ICOs/DLT, cyber security and innovation facilitators, but does not make additional recommendations for changes in EU regulation at this stage, in line with the EBA and EIOPA conclusions in their respective reports. ESMA also continues to foster supervisory convergence on the topic of crypto assets across Member States
MessageBird, the Amsterdam-based cloud communications platform company, is expanding its European operations with a new office in Dublin. Led by former Salesforce and Oracle executive, Roberto Marzo, the new office will employ up to 50 new positions over the next two years.
Initial hires will focus on sales, customer success and support for MessageBird’s fast-growing European customer base. The Dublin office is MessageBird’s fourth office in Europe, and its eighth outpost worldwide.
“Businesses across Europe are looking to access cloud communications technology to create brand building customer experiences for their customers. As our enterprise customer base across Europe has more than doubled in the last 18 months, we’re excited to add additional resources in Dublin to meet this growing demand,” said Roberto Marzo, Vice President of Sales Strategy and Business Operations for MessageBird. “Dublin’s thriving tech startup scene, and its highly skilled labor pool, make it an ideal location for MessageBird to further spread its wings in Europe.”
Mary Buckley, IDA Ireland’s Executive Director said: “International companies continue to be attracted to Ireland due to the ease of access to a talented workforce. Dublin is an internationally recognised technology hub where companies, including those like MessageBird, which are scaling their global operations at a rapid pace, can set up quickly and efficiently as they serve their expanding customer base internationally.”
Since its launch in 2011, MessageBird has built a global cloud communications platform that makes it possible for consumers to communicate with businesses in the same way they do with their friends and family – on their preferred channels, on their preferred timelines and with all the context of previous conversations. With easy-to-implement MessageBird technology, businesses are creating experiences that delight customers and keep them coming back, time and time again.
More than 15,000 customers have taken advantage of the MessageBird platform including globally recognized brands such as Lufthansa Airlines, Hugo Boss, Rituals Cosmetics, Google and SAP to fast growing startups such as Hello Fresh, SuitSupply and Uber.
MessageBird currently has nearly 250 employees supporting customers around the world from offices in Amsterdam, San Francisco, London, Hamburg, Sydney, Shanghai, and Singapore.
A revised Memorandum of Understanding (MOU) to promote science, technology and innovation cooperation between Ireland and China has been signed. The revised MOU between the Department of Business, Enterprise and Innovation and the Ministry of Science and Technology of the People’s Republic of China replaces the 2012 MOU to promote science, technology and co-operation. It will build on the strong links that already exist and explore opportunities for further collaboration between researchers and enterprise in the two countries.
International research and innovation collaboration promotes Ireland as a resilient, innovative, open and globally connected economy and aligns with the Future Jobs Ireland and Innovation 2020 strategies. Today, there are over 200 active collaborations between researchers and enterprise in Ireland and China. One of the key recent developments is the Science Foundation Ireland – National Natural Science Foundation of China Partnership Programme, which was launched in 2017. It involves joint funding of over €12 million for eight new research projects over four years.
The MOU was signed by John Halligan TD, Minister for Training, Skills, Innovation, Research and Development, and Minister Wang Zhigang, Minister for Science and Technology in the People’s Republic of China. Minister Halligan said: “It is very fitting that we are signing this revised MOU to strengthen collaboration between our two countries during 2019, which marks the 40th anniversary of diplomatic relations between the People’s Republic of China and Ireland. We look forward to working with Minister Wang and his Ministry to build on the existing collaborative links between the two countries. We know that research and innovation can play a significant role in addressing the many global challenges we face – from tackling climate change and protecting the environment to responding to the challenges of an ageing society.”
The Department of Business, Enterprise and Innovation has recently announced the establishment of a number of new positions at embassies abroad including one at First Secretary level at the Embassy of Ireland in Beijing, China. The position will be filled in September 2019 and the representative will work with Enterprise Ireland and IDA Ireland as part of Team Ireland in China. This appointment in Beijing is part of the continued implementation of the Government’s Global Ireland 2025 strategy.
Following the signing of the MOU, the Department of Business, Enterprise and Innovation hosted the inaugural Joint Committee Meeting which discussed recent developments between the two countries and the opportunities for further collaboration.
The Joint Committee comprises representatives from the Ministry of Science and Technology of China, the Department of Business, Enterprise and Innovation, the Department of Foreign Affairs and Trade, Science Foundation Ireland, Enterprise Ireland and IDA Ireland. It is co-chaired by senior officials from the Department of Business, Enterprise and Innovation and the Ministry of Science and Technology.
Crowe, Ireland’s leading accountancy practice and advisors to the Irish hotel sector, has launched the 24th edition of Ireland’s most comprehensive annual analysis of the Irish hotel sector. The Crowe Ireland Annual Hotel Survey, compiled from an analysis of Irish hotels’ 2018 accounts, shows that the sector experienced a positive year in 2018 with an eight-consecutive year of growth in turnover. Increased profit levels and average room rates have been recorded across all regions.
Notwithstanding the strong performance by the sector, the report analysis by the report’s author Aiden Murphy, finds that 2018 marked a turning point for the industry as growth slows amid increased costs, threats of domestic slowdown, weakened sterling and Brexit uncertainty. The report concludes that the sector recorded the lowest level of profit growth in seven years at a rate of 7%, a significant decline from the 12.5% growth achieved in 2017.
The report also highlights that revenue from rooms and food sales grew at the lowest levels in five years, at 5.9% and 2.6% respectively, highlighting the slowdown in revenue growth as a result of increased competition for restaurant and events customers from non-hotel outlets and no increase in occupancy levels attained in 2018. These findings indicate that it is becoming harder for Irish hotels to increase profit levels despite reasonable revenue growth, as many costs are now increasing faster than the underlying growth in revenues.
Average Room Rates – Midlands and East region breaks €100 for the first time
With demand levels in 2018 remaining strong, the average nightly room rate nationally rose to €118.27, an increase of 6.3% or €7 from 2017. Rooms in Dublin hotels had an average rate of €145.82 some 6.5% higher than the price achieved in 2017, up almost €9. Outside of Dublin, hotel rooms in the Midlands and East and South West regions were both up over €7, rising to €105.51 and €107.80 respectively. This is the first time that hotels in the Midlands and East region broke the €100 mark. The average room rate of hotels in the Western Seaboard area achieved an increase of over €6 to €93.83 last year. The Western Seaboard area now remains the only region with an average nightly room rate below €100. 2018 occupancy levels of 75.1% were consistent with the previous year at 75.4%.
Visitor Numbers & Brexit – Two thirds of hotel guests from domestic and British visitors
The 2018 report highlighted the importance of the Irish Domestic market to the sector overall which accounted for 55% of all guests last year, as domestic trips were up 13.4% year on year to 10.9 million trips. This increase is driven by strong employment and high levels of disposable income currently being experienced. However, the report shows the industry’s scale of reliance on the domestic, Great Britain and Northern Ireland markets- with two thirds (68%) of Irish hotel business dependent on these markets. This kind of exposure to these markets poses a potential risk for the industry when the possible economic impacts of a hard Brexit, weakening sterling and knock on implications on the Irish economy, including a possible fall in disposable income are considered.
Brexit has already created a dampening of demand from sterling-source visitors. Since 2013, the market share of hotel guests from Northern Ireland and the UK has dropped by 25%, but to-date the surge in demand from US visitors has balanced this out. Since 2013, the North American market has doubled in its significance for Irish hotels as a source of business. In 2018, this market was critical in generating demand across the sector with 17% of all Irish hotel rooms now sold to North American guests. Visitor numbers to Ireland from North America in 2018 were over 2.38 million compared to 1.16 million in 2013, highlighting the growing importance of this market for the sector and the potential for this market to continue to grow steadily. The launch of Tourism Ireland’s Fill your Heart with Ireland campaign is a well-timed proactive approach to growing this market and mitigating the risks associated with possible declines in visitors from the domestic, Great Britain and Northern Ireland markets.
In this changing marketplace hotels particularly in the border counties, have found it more challenging to pick up replacement volumes from international markets and so have become more dependent on the domestic market. As a result, 2018 saw hotels in the Western Seaboard region experience different trading outcomes depending on their location with hotels in Clare, Galway and Mayo doing well as the Wild Atlantic Way continued to deliver but hotels in Donegal, Sligo and Leitrim faced challenges associated with weaker sterling. While hotels in the Midlands and East Region also had varied experiences with Cavan, Monaghan and Louth being hit by the Brexit impact whereas Dublin doorstep counties of Meath, Kildare and Wicklow performed well as the compression effect out of Dublin was even more pronounced in 2018.
Increasing Costs- Insurance costs increasing at twice the rate of hotel revenue growth
The 2019 report highlighted the areas of Payroll, Utilities and Insurance as major challenges to the industry with costs steadily growing higher than revenues. Utility costs grew at 8% compared to a growth in total revenues of 5% from the previous year. On average hotels are seeing a 10% increase in annual insurance premiums when compared to hotel revenues increasing at 5%. For the second year in a row, payroll costs have also increased at a greater rate than total revenues placing added pressure on hotels across the country. Increasing costs relate to salaries and benefits, higher turnover levels and increased training and development in a highly competitive arena. This will continue to be one of the most challenging areas facing Irish hoteliers in the coming years.
Luxury Hotels- Source of largest growth
Of all classifications, luxury/five-star hotels saw the biggest increase in the average room rate in 2018, with a €10 increase over 2017 figures, and an average room rate of €228.18. Over the last 5 years since 2013 the average room rate is up €80 for five-star hotels, €37 for four-star hotels, €32 for three-star hotels and €22 for two-star hotels. Following investment in the luxury hotel market and the international profile that a number of these properties have achieved, they are attracting a greater number of higher spending visitors who demand the highest quality service and product offering. As a result, Ireland now has a greater number of higher spending visitors than in 2013, many of which are from the US.
Commenting on this year’s survey, partner at Crowe, Aiden Murphy said: “The growth in the Irish hotel sector improved again in 2018, with increases in average room rates and profitability not just in the capital, but across all regions. However, 2018 has marked a turning point for the industry as the sector recorded the lowest level of profit growth in seven years, impacted by increased costs especially across payroll, utilities and insurance.”
Speaking about the outlook for 2019, Aiden Murphy added: “Looking ahead to 2019, the 50% hike in VAT to 13.5% on rooms and food sales will make it a challenging year if the cost increases experienced in 2018 continue at a similar pace, making it difficult to pass on both the VAT increase and cost inflation to customers in terms of price increases. Rising costs such as insurance, payroll and utilities combined with the potential impact of a hard Brexit will make 2019 and future years more challenging for the sector.”
Commenting on the findings of the Crowe report, Brendan Griffin TD, Minister of State at the Department of Transport, Tourism and Sport, said: “As the Irish economy continues to grow strongly, ensuring competitiveness is sustained is a top priority for Government. Capacity plays a part in determining our competitiveness, increased demand in recent years has led to increased room rates, particularly in the main tourist destinations and especially Dublin, as supply did not expand at the same pace. However, in 2018, nearly 2,000 more rooms came on stream, helping to alleviate some of the capacity pressures previously faced. This increase in supply should help to ease any concerns that our accommodation prices are becoming uncompetitive.”
“As the Brexit deadline draws closer, the industry, must be ready to face the challenges this will bring. Almost €8 million in additional funding was provided to the tourism agencies specifically to respond to the impact of Brexit in Budget 2019. While the tourism sector faces some significant challenges in 2019, I have no doubt that the sector is resilient and robust enough to meet these challenges and that we will continue to grow tourism in Ireland in a sustainable way into the future.”
For more information or for a copy of the Irish Hotel Survey, please log on to www.crowe.ie.
Pictured (L-R): Roisin Martyn, Senior Consultant at Crowe; Brendan Griffin TD, Minister of State at the Department of Transport, Tourism and Sport; and Aiden Murphy, Partner at Crowe, at the launch of the Crowe Ireland Annual hotel Survey.