Finance companies were hardest hit.
Singapore 1000 largest SMEs saw a 9.1% drop in net profit in 2015, according to a report by DP Information Group.
The report showed that finance companies recorded the largest fall in average profit at 45.9%, followed by property companies, whose profits dropped by 40.2%.
“SMEs are struggling with the high cost of doing business, in particular wages and rents. They also face growing competition from across the region,” said Lincoln Teo, Chief Operating Officer of DP Info.
“Singapore’s SMEs are doing well to capture increased sales, but the real challenge is to lift their level of profitability,” Teo added.
On the flip side, information & Communications companies had the highest increase in average profit per company at +45.1%, followed by services companies 33.1%.
“In terms of average profits, the most improved group of SMEs are in the InfoComm sector. Many of these companies represent the next generation of innovative high-tech companies that could be a big part of Singapore’s future economy. Disruptive technologies are shaking up the way we live our lives and how we do business, and Singapore’s InfoComm SMEs are at the forefront of this change. So it is encouraging to see their profits on the rise,” Teo noted.
The combined revenue of Singapore's 1000 largest SMEs rose to $3 trillion in 2015.
The new high watermark was driven by the strong performance of the Commerce-Wholesale sector which added an additional S$413 billion in sales since 2013.
Another strong performer in recent years is Singapore’s Information and Communications (InfoComm) sector, which had S$31.9 billion in revenue in 2007, rising to S$68.2 billion in 2013 and increasing again to S$90.6 billion this year.
Manufacturing contributed 233 companies in 2007, falling to 175 in 2013 and to 146 this year. The sector’s contribution to revenue as a percentage of the total has halved since 2007.
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