More than 300 firms engaged in international sourcing

Between 2018 and 2020, 313 firms (7.5%) engaged in international sourcing. Of the 3,865 enterprises that did not engage in international sourcing, 121 had considered engaging in international sourcing during this period, while 86 had moved a business function abroad prior to 2018.

More than one in ten (10.6%) Industrial enterprises engaged in international sourcing between 2018 and 2020. This was followed by Services (8.3%) and Construction (6.3%), while 3.0% of firms in the Distribution sector moved business functions abroad during the same period. See Figure 2.1 and Table 2.1.

More foreign-owned than Irish-owned enterprises engaged in international sourcing

Between 2018 and 2020, almost one in eight (12.0%) foreign-owned enterprises moved a business function abroad compared to 4.0% of Irish-owned enterprises. Of the enterprises that did not engage in international sourcing, 72 foreign-owned and 48 Irish-owned businesses considered engaging in international sourcing between 2018 and 2020, while a further 66 foreign-owned and 19 Irish-owned enterprises had previously moved their business functions abroad prior to 2018. See Figure 2.2 and Table 2.2.

Enterprises sourced both core and support business functions

A slightly higher proportion of enterprises (4.5%) moved support functions abroad when compared to core functions (4.2%) during the period 2018 to 2020. Information technology (IT) at 2.3% was the most sourced business function abroad between 2018 and 2020, followed by Management & administration (2.0%), Other business functions (1.9%) and Engineering and related technical services (1.6%). Research and development (R&D) at 0.7% of enterprises was the least sourced business function abroad, followed by Marketing, sales and after-sales services (0.8%) and Transport, logistics and storage (0.9%).

More Industry and Construction enterprises sourced both core (5.8%) and support functions (5.9%) when compared to Distribution and Services at 3.7% and 4.1% respectively. A higher proportion of firms in Industry and Construction (4.4%) moved their Production of goods and materials business function abroad compared to any other business function. In Distribution and Services, the most sourced business functions abroad were IT (2.0%), Management and administration (2.0%) and Engineering and related technical services (1.5%). See Figure 2.3 and Table 2.3.

Transportation and storage sector had the highest proportion of sourcing enterprises

In the Transportation and storage sector, 32 of 183 enterprises (17.5%) moved one or more business function abroad between 2018 and 2020, the highest proportion among all sectors. This was followed by Information and communication (14.2%) and Professional, scientific and technical activities (13.2%).

More than one in ten (10.3%) Manufacturing firms engaged in international sourcing between 2018 and 2020. When a more detailed breakdown of Manufacturing is examined, it shows that enterprises involved in High & medium high-tech manufacturing had a higher proportion (14.3%) of sourcing enterprises compared to those in Low & medium low-tech manufacturing (7.8%). See Figure 2.4 and Table 2.4.

European Union the most common destination for sourcing business functions abroad

Between 2018 and 2020, more than half (51.8%) of the 313 enterprises that engaged in international sourcing moved business functions to another European Union (EU) member state (excluding the UK). A third (33.5%) of these enterprises moved a support function while 30.4% moved a core function. One in ten (10.2%) enterprises moved a business function to a European country that was not in the EU or UK.

Almost two in five (38.7%) enterprises moved one or more business functions to the UK between 2018 and 2020. More than a quarter (25.9%) of enterprises moved a support function while 22.4% moved a core function to the UK. A third (36.4%) of enterprises sourced to Great Britain while 7.3% sourced to Northern Ireland.

More than a quarter (25.9%) of sourcing firms moved one or more business function to India, with 15.3% moving a core function and 14.7% moving a support function. Of the 313 sourcing enterprises, 16.6% moved a business function to the USA and Canada. See Figure 2.5 and Table 2.5.