More SMEs looking overseas

Office workers at Raffles Place.
Office workers at Raffles Place. PHOTO: THE BUSINESS TIMES

The annual SME Development Survey polled companies here about their business outlook, key strategies and overseas expansion plans. Here are some key findings from this year's survey of 2,847 small and medium-sized enterprises (SMEs), which were released yesterday.

GROWTH STAGNATING

More than half of the SMEs here expect flatlining or falling revenue this year amid a lacklustre global economy.

The survey showed 47 per cent of the respondents do not expect any turnover growth this year, up from 40 per cent last year. Six per cent of those polled this year expect to see sales decline, similar to 7 per cent in the 2014 poll.

RISING COSTS

Manpower remains the main cost challenge, with 75 per cent of the respondents citing it as their top concern. This is followed by materials and rental costs. The share of those affected by rental costs fell from 50 per cent in last year's survey to 36 per cent, as the slowing economy put a cap on demand for retail and commercial space.

MORE LOOKING ABROAD

The share of respondents with overseas revenue has grown from 46 per cent in 2013 and 50 per cent in 2014, to 54 per cent this year. Myanmar has attracted the most interest, with a quarter of the respondents saying they plan to venture there. This is followed closely by Indonesia, which 23 per cent of respondents are keen on.

SCOPE FOR PRODUCTIVITY IMPROVEMENTS

About 71 per cent of the respondents said they have embarked on a productivity drive this year, from 87 per cent in last year's survey.

Among these companies, 47 per cent have introduced automation, while 35 per cent have fine-tuned business processes. Another 33 per cent said they improved productivity by optimising the use of manpower.

Of the remaining 29 per cent not looking to raise productivity, 91 per cent said they do not see the need to do so.

Chia Yan Min

A version of this article appeared in the print edition of The Straits Times on November 12, 2015, with the headline 'More SMEs looking overseas'. Print Edition | Subscribe