2 April 2015
SMEs less optimistic about near-term business outlook
Angela Teng

SINGAPORE — Small and medium-sized enterprises (SMEs) here expect their sales and profits to weaken in the next six months, an index by the Singapore Business Federation (SBF) and DP Information Group showed.

The SBF-DP SME Index, which measures the sentiments of SMEs, surveyed about 3,600 such firms across various sectors including business services, construction, manufacturing, retail and food and beverage, as well as transport and storage.

A score above 50 indicates a positive sentiment. Based on the index released yesterday, the overall score was 54, compared with 54.4 in December. The outlook for the retail and food and beverage sector worsened the most, dipping from 54.7 to 51.5.

Association of Small and Medium Enterprises president Kurt Wee told TODAY that a lot of SMEs in the retail and food and beverage sector are facing challenges such as high manpower costs — as a result of the tight labour market — and competition from overseas players via e-commerce. “Brick-and-mortar stores are in a dire need to transform their business model, especially so for the retail segment, which needs to undergo structural improvements to stay competitive,” he said.

Given the less optimistic domestic outlook, companies are looking to expand into South-east Asian markets, Mr Wee said. “SMEs are now looking into internationalisation ... to make sure their base is broader,” he added. 

Link: http://www.todayonline.com/business/smes-less-optimistic-about-near-term-business-outlook