As Singapore’s economy improves, there is good news for the small-and-medium enterprises (SMEs) in the new year as they expect stronger sales and profits from January to June in 2018, according to a survey conducted by Singapore Business Federation (SBF) - DP Information Group SME Index.
The survey, a joint initiative by the SBF and DP, showed that sentiments have improved across all six industries, with each recording a score above 50 points, indicating an expectation of growth. The industries are commerce/trading, construction/engineering, manufacturing, retail/food and beverage, business services, transport/storage.
The expectations for the SMEs are high in the coming year as the overall score was 51.2 points, a 1.2 per cent increase compared to the previous quarter.
In a press release, SBF and DP said, “Among the industries, business services recorded the highest score of 52.1 points. It is a key supporting sector for other industries, and that when the level of economic activity rises across other sectors, demand for business services also tends to increase.”
The construction and engineering sector, which contracted in the previous quarter, returned to optimism at 50.4 points.
SMEs also showed that they are looking for new opportunities to grow their business and generate more revenue, as well as a greater confidence to secure financing.
“The capital investment index eased from the previous quarter, indicating that many SMEs may be holding back new capital expenditure as they await next year’s Government budget,” SBF and DP noted.
Commenting on the anticipated better performance of SMEs in the coming year, Ho Meng Kit, SBF chief executive officer, said, “SMEs’ business sentiments have been deteriorating over the past three years, so this latest survey that SMEs across all sectors are feeling positive about their outlook for next year is welcome news. Our improved export performance and better performing service sectors have contributed to better sentiments of our smaller companies.”
He said, “SMEs should ride on the tailwind of better times ahead to undertake serious effort to transform their companies. SMEs should embrace digitalisation, and strive to be more innovative and competitive.”
“The SBF will continue to advocate for the business community, work with other trade associations and chambers, as well as the Government to improve the state of local SMEs,” he added.