How businesses should cope amidst a sluggish economic outlook

Oct 31, 2017

This story is sponsored by Standard Chartered Bank (Singapore) Limited (“SCBSL”).

While Singapore’s economy grew 1.8% by the end of 2016, the unanticipated pace of growth still marks the country’s slowest annual growth rate since 2009. Outlooks remain cloudy as Singapore — largely an export-dependent country — faces external factors including increasing pressure from looming threats of a possible protectionist United States that could negatively affect global growth. The Southeast Asian nation’s increasingly ageing population and faltering trade activities could also impact businesses and their operations.

Recent forecasts made by the Monetary Authority of Singapore (MAS) signal an increase in inflation, averaging from 1% to 2% this year compared to 0.9% in 2016. This development will likely be a slight bump for Singaporean businesses and consumers due to the eventual increase in costs.

Mr. Ravi Menon, Managing Director, MAS, who spoke during the Wealth Insights Conference early this year, confirmed this of Singapore’s economy: “Economic restructuring remains a work-in-progress and we need to do more to raise productivity growth. Singapore will not be immune to the global tightening of financial conditions, volatility in capital flows, and potential stresses in the regional corporate sector.”

Singaporean businesses will need to maintain efficiency while adopting new measures to raise productivity. These include enrolling workers in skills training courses, purchasing new equipment to automate processes, as well as making use of information and communications technology to a greater extent. While such measures often require businesses to commit additional funds, the long-term effect of capital investments on growth could outweigh the initial cost.

Businesses and other corporate entities would do well to have a strong financial capital and diversity to cushion operations and provide a soft landing for any future and prospective activities amid the global tightening of financial conditions that Mr. Menon mentioned. Increasing capital expenditures for business operations improvements would also provide a much better chance for returns, and cushion a company’s liquid capital from volatile capital flows. While international expansion may be more inclined for businesses with economies of scale, having a regional mindset could also give growth opportunities for enterprises with Singapore in a sweet spot — literally and figuratively — as a leading economy in Southeast Asia, a region home to over 600 million people.

An opportunity for Singaporean businesses to stimulate growth lies in a rethink of marketing activities. By shifting from traditional marketing to digital marketing, businesses can reap the benefits of lower overhead costs while reaching out to more potential customers on a larger scale. Given the availability of various online analytical tools, it is also possible for businesses to look into and continually adapt their activities to keep up with changing market trends.

Despite these troubling outlooks, business expansions can still be made possible through wise business banking. There are available financial solutions and options to generate funds for expansions through business loans and overdrafts, working capital solutions, as well as trade finance and property financing. Having an expert support available anytime, on top of easily accessible capital, is also vital in ensuring and sustaining the growth of businesses in such uncertain times.

To help businesses weather these economic headwinds, for example, Standard Chartered offers a Business Instalment Loan that aims to address SME business’s capital needs. Business Instalment Loan is an unsecured business term loan that offers up to $300,000 loan quantum with maximum loan tenure of 5 years.

The loan application needs no collateral, only personal guarantee(s) required. The application process is simple with minimal document requirements such as the Company’s operating bank account statements for the past 6 months and latest 4 quarters’ Goods & Services Tax returns statements. An efficient loan approval process also means that business can access the funds quickly.

Businesses have a reliable partner in Standard Chartered, with over 150 years of banking and finance experience in Asia, Africa, and the Middle East. Understanding the unique financial needs of each of their individual clients, Standard Chartered tailors a set of solutions from the wide range of services offered, including any transactional, financial, and business protection needs as well as banking and wealth management solutions for owners and employees alike. For businesses with an eye on international expansion, Standard Chartered’s strong network and presence across 25 countries around the world would be an invaluable asset. The bank is strategically positioned to provide specialist knowledge, access to trade finance, as well as foreign exchange and cash management solutions for businesses spanning countries and continents.

This article is for information purposes only. All loan applications are subject to SCBSL’s loan approval process at its sole discretion. Visit Standard Chartered’s Business Instalment Loan page for more information. The views and opinions expressed are the author’s own and Standard Chartered accepts no liability for any of the contents, views or opinions expressed by the author of the article.
 

About

Standard Chartered Bank has a history of 158 years in Singapore. It offers banking services to retail clients spanning across deposits, lending, wealth management products, among many others. The bank also offers SME Clients quick, easy and transparent business banking solutions so they can focus on what matters most to them – growing their business.

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