60% of them weren't confident about the local market's conditions.
Wedged between small-medium enterprises (SMEs) and multinational corporations (MNCs) are Singapore's mid-market enterprises (MME). According to a report, there are already around 1,200 MMEs in Singapore that have supported sales of $171b and $58b in Gross Value Added (GVA).
MMEs were also able to employ 550,000 people, which comprises about 17% of market sector employment. With over 8% per annum, they also contribute the highest employment growth rate around the world.
However, most of these MMEs still lack confidence in their local market conditions. Whilst they are contributing billions to the economy, woes about their strategies hinder their growth, HSBC revealed.
According to HSBC's survey, around 26% of MMEs were more focused on growing their current markets, compared to the 13% that eye international expansion. Despite this, domestic volatility remained a top concern for the 60% of respondents.
Only half of MMEs were also confident in their strategies, lower than the 65% around the world.
HSBC also found out that if these MMEs were to boost their export-based revenues by just 1%, the would contribute US$300m GVA more to the economy.
HSBC Singapore head of commercial banking Alan Turner said, "MMEs are the backbone of the economy, making significant contributions to Singapore’s economic and employment growth. But it’s clear from the report that if they were to further consider international strategies and increase their cross-border activity, they could potentially mitigate these concerns by accessing a larger customer base and increasing their revenues."
Still, these MMEs think they will see more business opportunities. About 54% believe this would happen if barriers to entry came down, 42% said it would be better had they easier access to export markets, whilst 29% said this could happen if there were fewer threats from smaller companies.
HSBC's survey also found out that 74% prioritise better understanding of market shifts, and 66% are working on responsive operations over the next three years.
"MMEs are often the ‘middle child’ across the corporate landscape – not small enough to be in line for the bulk of government subsidies or programmes, and not large enough to garner influence like their larger peers," Turner added. "Clearly, a greater focus on this layer of Singapore corporates has the potential to unlock growth for both the companies in question and those in their ecosystems."
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