SINGAPORE – Small and medium-sized enterprises (SMEs) that adapted their operations after last year’s circuit breaker were better prepared for the disruptions amid the heightened alert measures in May and last month, said a new study.
Take Hyper Communications, an SME in the information and communications technology sector.
Director Murphy Sim said Covid-19 served as a reminder that changes can occur rapidly, especially in the technology field.
His firm had set up an online e-shop pre-Covid-19, and adopted e-payment capabilities that helped it to better withstand the pandemic.
“But it is also important to be able to adapt quickly,” he added.
“In the last year, we deepened our cloud-based and data capabilities and conducted training to upskill our staff… This drive to innovate is necessary to thrive in today’s competitive environment.”
The firm’s experience is mirrored in an OCBC Bank study that is used to compile its SME Index, which surged 8.3 points to 59.5 in the second quarter from 51.2 in the first.
When the index is above 50, it indicates an improvement in the health of SMEs relative to the same period a year earlier.
The SME Index uses data from 100,000 of OCBC’s SME customers with annual sales turnover of up to $30 million.
The data reflects collections, payments, cash flow, account activities and balances – metrics that provide a good indication of the state of a firm’s health.
Collections from sales across the 100,000 SMEs represented in the index grew by 6 per cent from the first to the second quarter this year.
Mr Linus Goh, head of global commercial banking at OCBC, said the pandemic has had a profound impact on SMEs in Singapore, forcing entrepreneurs to find new ways of doing business.
Their recovery was supported by a rapid shift towards digitalisation and e-commerce, he said, adding that SMEs can also build on Singapore’s strength “as a growing hub for the services industry, the changing supply chains and the emerging green economy”.