Govt wants more SMEs to take up assistance schemes

SINGAPORE — His first two attempts to modernise the inventory of his 28-year-old wholesale electronic appliances business a decade ago were unsuccessful and cost him more than S$4,000.

However, after reading about the availability of government assistance schemes and how the Small and Medium Enterprise Centres could help with business consultation last year, Mr Richard Teh, managing director of New City Electrical Trading, decided to find out more.

After consulting business advisers at the centre, Mr Teh, 52, a second-generation boss, spent S$40,000 on a new, customised point-of-sale system, which reflects his daily profits and updates the inventory of his heartland business in real time.

He had tapped the cash-out option of the Government’s Productivity and Innovation Credit (PIC) scheme, which allows him to claim up to 60 per cent, capped at S$100,000, for investment in activities such as introducing information technology and automation equipment.

Speaking to reporters yesterday, Mr Teh said improving his business’s productivity was something he knew had to be done to keep pace in a competitive business climate.

With the new system, what previously could take hours just to check if an item was in stock, now takes mere seconds. The greater control over the movement of his products has allowed him to expand his business here, as well as in Malaysia and Myanmar.

“Without the Government’s grant, we wouldn’t have been bold enough to invest that much into the business,” Mr Teh said.

Such assistance schemes and free business advice available at the 12 SME centres are how the Government hopes to get heartland retailers to sustain and expand their businesses. So far, these centres have helped about 20,000 SMEs. The Government will also be setting up another three centres this year.

“We hope to reach out to more heartland shops and micro-enterprises and we also hope that some of the shops can quickly take up the schemes,” said Minister of State (Trade and Industry) Teo Ser Luck. “Because the earlier they take up the schemes, they can see the benefits sooner.” He was speaking on the sidelines of a visit to shops around Block 201, Tampines Street 21, yesterday.

While the take-up rate for such schemes has been increasing every year, there is still a need for better awareness, Mr Teo said.

Noting that there are some micro-enterprises that are reluctant to take up such schemes, Mr Teo said: “Many of them have been in the business for many years and their business models do not change. It will take some time for them to change their mindset.”

He added that not all of the heartland shops see brisk business and they face day-to-day cost challenges, thus preventing them from upgrading or expanding.

Such business owners may also not be keen to take up these schemes due to their age, suggested Mr Teh. “Most of these owners are not young ... They could be thinking that since they’re about to retire, why try so hard?” he said.

Such feedback is something the business advisers at the SME centres are familiar with, said Mr Eugene The, general manager of SME Centre@Asme.

Nonetheless, the centre will continue engaging the merchant associations in the area to spread the word. “Sometimes, you only need one to two persons to pick up these schemes and the word will spread,” said Mr The.