SMALL and medium-sized enterprises (SMEs) in Singapore and elsewhere are likely to grapple with escalating costs, challenges in talent acquisition, and regulatory changes in the environmental, social and governance (ESG) landscape, a new study has found.
Amid global supply chain and trade disruptions being linked to sharp increases in the prices of utilities and supplies, nearly six in 10 businesses (58 per cent) cited higher costs as their top concern, according to the study done by the Association of Chartered Certified Accountants (ACCA).
A quarter of respondents shared that utility prices had gone up by more than 20 per cent.
The professional accountancy body said that SMEs need to have effective cost-management practices as well as innovative financial strategies.
ACCA recommended that companies adopt digital technologies that would enable them to streamline operations, reduce costs and enhance productivity.
“As we enter the new year, SMEs are grappling with a wide spectrum of challenges, but our findings are also a clarion call for SMEs to embrace strategic innovation,” said ACCA’s head of SME Aleksandra Zaronina-Kirillova.
“By addressing these challenges head-on, SMEs can unlock new growth avenues and strengthen their market position,” she added.
Job vacancies for professional workers were reported by 31 per cent of businesses. Fourteen per cent said they were unable to find suitable candidates for roles such as clerical workers, technicians, and service and sales workers.
This calls for a renewed focus on talent acquisition, skill development and retention strategies, said ACCA. The implementation of continuous learning and development opportunities can be used to retain top talent in companies, the body said.
In line with regulatory changes in the ESG landscape, nearly 50 per cent of SMEs are now required to provide ESG information.
This highlights the growing importance of sustainable practices for SMEs to retain their competitive edge. However, the report identified a gap in the ability for some SMEs to generate and manage this data, which presents both a challenge and opportunity for them.
ACCA noted the importance of embracing sustainable practices – not only as a regulatory compliance measure, but also as a strategic move to attract new business and customers.
“In these testing times, SMEs must pivot towards innovative strategies to navigate the complexities of cost pressures, talent retention, and sustainable practices,” said Zaronina-Kirillova. “Our research not only identifies the critical hurdles but also offers a roadmap for SMEs to emerge stronger and more agile.”
Source: The Business Times
Link: Here
February 15, 2024
