What does Infotrust’s information tell us?
In this article, we intend to evaluate the dynamics of the Portuguese business sector, to analyze the geographic pattern of the companies, the phenomena and the moves that they undergo over a five-year period.
How can we evaluate those dynamics?
Answering to the questions:
Where – which geographic distribution, where are they established, growth rates
Who – which sectors, growth rates
WHERE?
GEOGRAPHICAL SCOPE OF NEW COMPANIES
In the first semester of 2021, 20.248 companies were established, which in comparison with the same period in 2020, represents an increase of 14%.
Analyzing the first semesters since 2017, we can notice, that until 2019 the growth tendency is positive, decreasing around 33% in 2020. Remember that, at the time, the economy was already suffering the impacts of COVID-19, hence this enormous retraction from the businessmen, when it comes to the establishment of new businesses.
Source: Infotrust's Observatory
In the first semester of each year Lisbon, Oporto and Braga, were the districts that grew the most in terms of establishing new businesses.
Making a balance of the last five years, we can see that between 2017 and 2021, counting the first semesters of each year, the variation was negative by 3%, largely thanks to the decrease that occurred in 2020.
Source: Infotrust's Observatory
In a geographical scope, the districts where the businessmen invested the most in the first semester 2021 where: Lisbon, Oporto, Braga and Setubal, this tendency, follows the same that occurred in 2017.
Comparing with a five-year history, in a total of 20 Districts, these four Districts have a combined weight of more than 65% in the establishment of new businesses.
Source: Infotrust's Observatory
GEOGRAPHICAL SCOPE ON BUSINESSES CLOSURES
After a positive tendency, with businesses closures decreasing from 2018, in the first semester of 2021 there was a turnaround, with a growth of 49%.
As presented, if in one hand we can verify an increase of new businesses in relation to the year before, with the most dynamic districts being, Lisbon, Oporto, Braga and Setubal, these, are also those where the most companies have closed in the last five years. In these closures, only the district of Lisbon has a weight of 36,9% in the total of the country.
Doing a balance of the first semesters of the last five years, we can see that between 2017 and 2021, there were variations of 94%, whereas in 2017, 7280 businesses closed and in 2021, 14.099.
Source: Infotrust's Observatory
WHO?
In this topic we will look at which sectors of activity have shown the greatest dynamism during the first semesters of each year since 2017.
SECTORIAL SCOPE OF NEW BUSINESSES
If the services sector represents the biggest bet of the businessmen, the numbers prove that it is also where more businesses closed, closely followed by retail, catering, tourism and construction. This is a tendency that trends through the first semesters of 2017.
If we compare the two economic phenomena, we observe that in times of a bigger economic retraction, both are synced. In 2017, less businesses were established and a rise in closures occurred. The same tendency of synchrony between these two indicators, was kept until 2021. In the first semester of the year, in spite of the closures increase, the dynamism when it comes to business establishments was positive, which can be a sign of a bigger confidence of the Portuguese businessmen.
How did the insolvencies evolve?
Analyzing a five-year period, it can be concluded that a downwards tendency exists, after a little interregnum that decreasing line, in 2020, that goes hand in hand with the decrease of the establishment of companies which we can allegedly attribute, to the pandemic crisis that devastated Portugal.
Oporto, Lisbon and Braga, were the districts where more insolvencies were accounted. In this first semester of the year, with 267, 203 e 157, respectively.
The manufacturing industry leads the insolvencies in the semester presented, representing 20,3% of the insolvencies, followed by retail (15,6%) and catering and tourism (15%). The more significative increases by sector, in the homologue comparison, are verified in the catering and tourism sector (+31), education (+8) and in the stock farming, hunting and fishing sector (+5).
The biggest decreases, in comparison with the first semester of 2020, when it comes to insolvencies, occur in the sectors of: manufacturing industries (-116), wholesale commerce (-22) and in the services sector (-18).
Making a balance of the last five years, we verify that between 2017 and 2021, accounting for the first semesters of each year, the variation was negative -26%, whereas that in 2017,1429 insolvencies were already accounted, in opposition to the 1053 registered in 2021.
Source: Infotrust's Observatory
In general, we can mention that there is a greater business dynamic, with the economic crisis caused by Covid-19, in 2020 the new establishments of businesses decreased that year, interrupting the growing trend that had been going on for the last five years. In the first six months of 2021 we again verified an increase of new companies. Insolvencies, after the slight growth in 2020, also declined again this semester. The only indicator that had a very significant increase is the Closure of Companies, regarding the positive trajectory that was demonstrated until 2020, as a result of the economic situation caused by the pandemic.
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