By Dennis Ng
Regional Head of SME Ecosystem and Enterprise Business

Asia and Africa have an emerging challenge: to create 600 million jobs for their growing workforce by 2030. If the current pattern holds, small and medium enterprises (SMEs) are expected to generate two-thirds of the jobs in these developing economies.

But there’s a hitch. While SMEs already account for up to 40 per cent of economic output in these regions, success is elusive for them despite their economic importance.

For every start-up that succeeds, nine fail. SMEs face many obstacles on the path to success, including high labour costs leading to underemployment, or prohibitively high interest rates that curb funding for expansion. In general, SMEs lack the spending power required to help them operate efficiently, leaving them unable to take advantage of instruments of success that bigger companies have access to.

For many entrepreneurs, the decision to take the plunge into business is just the beginning of a long journey. We break down the five most common hurdles SMEs must overcome.

Five challenges for SMEs

  1. Attracting new customers
  2. Attracting customers is a problem that many businesses, including big companies, struggle with. However, larger companies with a history of success usually find it easier as they have access to more resources.

    Smart branding is hugely important. With it comes greater recognition, increased business value and the ability to generate new customers at a faster pace. Attracting new customers while maintaining high-quality service with existing customers can be tricky, but is vital for success in a competitive market.

    Proactivity is also crucial for any small business. This means making phone calls, attending relevant networking events and mastering the various marketing channels.

  3. Maintaining profitability
  4. Profitability is a challenge for any business no matter what industry it’s in. Reducing costs while increasing turnover, productivity and efficiency require constant effort and innovation.

    Businesses should be looking at their suppliers, premises, production processes and finance facilities as the ones that were a good fit a year or two ago may no longer be the best solution.

    Introducing initiatives such as remote working may enable a business to downsize and save overhead costs, and at the same time boost employee efficiency.

  5. Securing funding
  6. Although business lending is now far more accessible, accessing finance is still a concern. Many SMEs are turning away from banks, but it is important to remember that this is not the only option. Alternative lenders are there to help and come without the typical “tick box” mentality, meaning they can provide flexible and customised funding solutions. Whether a business is looking for a short-term business loan or more flexible credit with a longer term, there’s a broad range of funding options available.

  7. Increasing revenue
  8. It is common knowledge that every business struggles to drive, maintain and sustain growth. Last year alone, nearly six in 10 SMEs found increasing revenue problematic.

    While it is impossible for businesses to control all the market forces they are up against, there are a few things to do that can help increase revenue. For example, if a business is operating within a market that is too small to generate the desired profit, expanding into other markets digitally could be considered.

  9. Retaining valuable employees
  10. A failure to demonstrate the worth of employees and the work they do could lead to a business losing some of its most valuable assets. It is important to remember that while salary is a big factor in employees feeling valued, there are other ways to recognise your employees.

    Employees tend to be loyal to businesses that care for their wellbeing and offer good fringe benefits such as insurance, recognition and rewards. Today, there are solutions catering to SMEs that enable them to provide these benefits and more to employees.

Solutions for SMEs

Technology can make things easier and simpler for SMEs. Some of these include accounting software packages, marketing tools and project management tools. Digital technologies allow SMEs to access market intelligence, scale their operations, and tap global markets and knowledge networks at relatively low cost.

Ipsos Consulting says SMEs that are digitally engaged are more likely to gain 15 per cent additional revenue and are about 3.2 times more likely to derive income from international markets than their peers. Nuanced digitalisation helps SMEs to be “born global” and enhance their competitiveness.

At first glance, it may be daunting for the SMEs because technology is typically expensive and hard to bring on board. These tools are now available on PRUworks, Prudential’s value-add ecosystem that offers SME owners easy access to services that will help them manage their business better.

Whether entrepreneurs are starting from scratch or upgrading the family business, adapting to change and solving problems are imperative. With technology solutions like PRUworks, automating processes and managing data with cloud-based systems becomes easier. SME owners can meet the needs of their growing customer base and extend to new markets with new levels of convenience and cost efficiency. This enables them to focus their energy and resources on growth and expansion.

Dennis leads the charge on PRUworks, which provides SMEs access to the tools that big companies have. PRUworks levels the playing field for SMEs, providing a platform for business owners and their employees to gain easy and convenient access to digital business tools for workforce health, business productivity and employee engagement, helping to manage their business better. PRUworks is now available in Hong Kong, Indonesia and Singapore.

More information on PRUworks

PRUworks will be one of the many services that Prudential will soon make available to users of the Pulse by Prudential digital app. Pulse enables users to manage their health and wealth holistically through access to advanced, AI-driven symptom checker, health assessment and wellness tools, as well as virtual consults with qualified doctors.

To help SMEs protect their employees and business, Prudential offers insurance plans that provide coverage catered to a company’s size, needs and budget. With the assistance of its financial consultants/agents, SMEs can choose plans that offer the best coverage to fit their needs.

Through PRUworks, business owners and HR personnel can easily adjust insurance coverage based on employee movement. In turn, employees have mobile access to a benefits portal which allows them to submit and make claims easily and at any time.

PRUworks also offers an ecosystem of value-added services, many of which are aimed at helping SMEs nurture a healthier and more productive workforce. In Singapore for example, wellness solutions are a core component of PRUworks. These include fitness monitoring and tracking, specialist doctor recommendations and health screenings, offered in collaboration with Health Tech companies.


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