"Essentially there has never been a better time to be in business, " said Patricia Callan, chief executive of the Small Firms Association.

Over 19,000 new companies were established in Ireland last year. New company registrations were up by 11%, the fifth consecutive year of growth, and look set to breach the 20,000 barrier for the first time in 2007.

Entrepreneur Emmet O'Neill is likely to contribute to that number. The construction firm he established last year is just one of the many projects he has on the go. In between building extensions and conservatories it is busy working on O'Neill's new restaurant (his second) and later this year it will be called in to service to build a new dental clinic, the newest store in his expanding Smiles chain.

"The economic climate is still very strong. All the factors are there, " he said. He checks off the obvious factors including continued strong economic growth and high levels of disposable income and consumer confidence. The young Dubliner also feels the recent budget, with its tax cuts and a beefedup business expansion scheme, is "pretty favourable towards small and medium enterprises".

Banks are also taking a favourable view of the SME sector. O'Neill has secured a Euro1m loan facility from Anglo Irish Bank to help expand Smiles and said he plans to raise up to Euro2m more before the end of the year to help him push into the UK and, possibly, the US. "The money now is much more readily available for businesses.

Much more so than it was.

There are people out there who really want to invest, " he said.

This year the high street banks are making a strong pitch at small companies across the board. Bank Of Ireland recently cut its rates for small business loans from 8.1% to 6.2% for those seeking loans of Euro25,000 or less.

Ulster Bank, which offers an even more aggressive 5.95% loan rate, has also been battling hard to secure the business of the small and start-up business. Ulster Bank's head of commercial and business banking John McGrane said he expects the year ahead to be a busy one for new company formations. "In our view there is a very broad based SME sector out there that is very conducive to start-up businesses, " he said.

Many of the new entrepreneurs are entering sectors such as retailing, childcare and convenience food. "Anything that makes life convenient for consumers is doing very well out there, " he said.

Ulster Bank is fielding a lot of enquiries from people interested in taking on franchises such as those of symbol retailers Spar, Supervalu, Mace and Londis. Franchise outlets are a desirable option for many budding entrepreneurs, according to McGrane.

Having the support of a proven brand and business model is attractive for both the potential owner and the investor putting up the money, he said. "We have a very high regard for franchising as a vehicle for people who want to start their own business. There's more activity there than ever before, " he said.

John Green, chairman of the Irish Franchise Association said its members are seeing compound growth of 12% per year in new franchisees signing up with chains ranging from fast-food outlets such as McDonalds to carpet cleaning franchise ChemDry. Green said many of the new entrants were venturing out into the realm of the self-employed for the first time. "There's a diverse range of backgrounds. Market traders, people who worked on shop floors, people in offices and middle management. Most franchisees would not have had business experience for themselves before. They would have worked for somebody else, " he said.

The IFA is expecting to see the benefit of the maturing SSIA accounts towards the second half of this year. Green said according to its most recent survey, in 2004, some franchisees were putting up as little as Euro21,000 of their own money. With many SSIA holders expecting Euro20,000 plus payouts, franchise operators are keen to sell them on the benefits of putting that money to use to start their own businesses. "If a couple both have been saving between them they could probably come up with Euro40,000. That's a fair amount of money if you're looking at starting your own business, " Green said.

The SFA's Patricia Callan, however, said those planning on joining the seemingly everexpanding retail and services sector should think carefully.

"It is a concern for us generally that about 70% of the [SME] market is domestic services. That is fine while there is lots of money around and people are buying these services, " she said. The SFA is concerned that the economy is overweight in services which essentially are living off the boom in domestic consumer spending and that many of the new shops, restaurants and bars could be hard hit if the economy cools down. Callan noted that redundancies in the service sector exceeded those in the manufacturing sector last year for the first time. She said she would like to see more entrepreneurs forming businesses which export goods and services rather than solely servicing the needs of the Celtic Tiger.

"Traded goods and services are the key, " she said.

Emmet O'Neill said despite his own bullish expansion plans he is conscious the good times might not always be so good. Among his worries is any downturn in the property market, which would hit consumer confidence and spending hard. "So much of this country's wealth is based on property and notional equity", he said. "One of the things that's worrying and scary is talk of house price collapses and so on. You kind of wish the economists would close their copybooks and go away".

With one eye out for any rain clouds on the horizon O'Neill said he is taking a three month breather to "bed down" his existing Smiles outlets before embarking on his planned expansion push later this year. "What I want to do over the next three months is build up a little bit of a fund, an everyday fund, just in case this economy does turn down as certain people have been saying".