Global expansion tops SME agenda amidst market volatility, DBS finds

The drive is led by information and communications and manufacturing firms.

Local small and medium-sized enterprises (SMEs) are increasingly looking overseas and embracing technology as they navigate a more complex business environment, according to the latest DBS Business Pulse Check Survey.

Of the 730 firms surveyed between December 2025 and January 2026, 82% said they plan to expand internationally this year.

The push is strongest amongst information and communications and manufacturing companies, driven mainly by the desire to reach new customers (49%) and strengthen their overseas brand (43%).

SMEs aiming for new markets emphasised the need for reliable local partners, insights into market conditions, and guidance on regulatory requirements to support successful entry and growth.

Technology, particularly artificial intelligence (AI), is also becoming central to competitiveness. About 67% of respondents said they already use some form of AI, though only 12% have fully integrated it across their operations.

Adoption is highest in information and communications, electronics manufacturing, and professional services, and lowest in wholesale and trade.

Firms identified financial support, expert guidance, and partnerships with tech providers as key to turning AI use into measurable productivity gains.

Sustainability is another area of focus. The proportion of SMEs considering themselves “sustainability-ready” has risen to 49%, up from roughly a third last year, whilst those feeling unprepared dropped to 27% from 60%.

Companies said wider access to affordable green technologies, practical implementation frameworks, and staff training is needed to maintain progress.

These efforts are occurring amidst ongoing challenges. About 36% of respondents reported that tariffs and trade restrictions have affected operations, causing higher costs and supply chain disruptions, including delays and material shortages.

Despite these obstacles, optimism is cautiously steady: 57% of SMEs expect better performance in 2026, supported by investments in productivity and expansion into new markets.