73% of SMEs say rising costs are their biggest concern this year

SINGAPORE: More than seven in 10 small and medium-sized enterprises (SMEs) in Singapore said rising costs were their biggest concern for 2024, according to a new survey by the Singapore Chinese Chamber of Commerce and Industry (SCCCI).

The survey results were shared by SCCCI president Kho Choon Keng at the 27th annual SME Infocomm Commerce Conference on Oct 9. According to Mr Kho, 73 per cent of respondents pointed to rising costs as their top concern, followed by manpower availability at 54 per cent and the need for business transformation at 37 per cent. 

The Business Times reported that while the top two concerns were the same as last year, concerns about uncertain economic and political conditions abroad, which were among the top three worries last year, did not make the list this year.

In addition, even though 77 per cent of those surveyed expect to make a profit this year, nearly half think their profits will be lower than last year.

Mr Kho noted that many SMEs understand the need for transformation to stay competitive, but they face internal difficulties. Common problems include a lack of skills, uncertainty about the results of changes, and resistance from staff.

Minister for Manpower Tan See Leng, who was the guest of honour at the conference, acknowledged the pressures on SMEs in today’s unpredictable global market. He encouraged businesses to view these challenges as opportunities for growth.

He noted, “We are often not spared from external trends,” mentioning rising geopolitical tensions, disruptive technologies, and changing supply chains.

Dr Tan stressed the importance of tapping into Southeast Asia’s growth potential, given its young population and strategic location. He urged SMEs to diversify their supply chains and expand their market reach.

He added, “Sustainability reporting is also fast becoming a critical capability that large corporations look out for in supplier selection.”

The need for better cooperation between trade associations, the government, and the private sector was also emphasised.

The SCCCI’s survey found that 61 per cent of respondents had applied for government support schemes, with help in digitalisation, manpower retention, and cost reduction being the most useful.

Dr Tan praised the SCCCI for its ongoing efforts to assist businesses, particularly through the recently launched Trade Association Committee Transformation Centre. The centre, which was launched in August, aims to strengthen the capabilities of local trade associations, helping them serve their members better in areas like internationalisation, sustainability, and digitalisation. /TISG

Read also: Profit-focused or power-hungry bosses may make SMEs a tough place to work at, netizens say

Featured image by Depositphotos