So far, the government’s efforts to specifically help SMEs have focused on training programmes for SME managers and the grooming of a few SMEs which are deemed to have the potential to become home-grown MNCs. The result is that a few enterprises receive a disproportionate amount of funding and assistance from the government, while those that really need the help get very little.
The government should dispense of its habit of “picking winners”.
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I like the way the Singapore government thinks that it can actually run businesses. I mean the only businesses that it runs successfully are those where it can kill off the competition by manipulating laws and other levers of industry to ensure that it has a monopoly, thus killing off all competition. One of my favourite examples is in the media industry where it decided that it agreed with SPH and MediaCorp on the idea that the market is “too small” for competition and so the two big media houses could return to selling us junk in return for astronomical profits. I can’t think of a business that the government owns that has done well overseas the moment it has had to…well face real competition.
So, what makes them think that they’re good at picking winners. I mean as a small business I have no qualms if the government decides to fund me silly. But then again, what will that mean? Does that mean I have to run business the way the government decides? If I had to do it, I should probably shoot myself because it won’t be a business anymore. Government is very good at having great brainwaves but not very good at dealing with reality on the ground. Are you surprised your Singapore SME gets slaughtered by your Hong Kong SME. In Hong Kong the business people run business and thus allowed to become darn good at it.
Yes the goverment will tell you your biz should fail if it’s not productive. All talk & no action. No wonder our SME fails in Singapore. We do not have an thriving environment for SME at all. I wonder if the same can be said of them, if they are not productive we should vote them out.
I read in the newspapers about Government warning local companies better meet the productivity growth rate or risked moving out of Singapore?
Has our Government forgotten about local entrepreneurship it was promoting just couple of years back?
Obviously they dont quite understand Entrepreneurship right from the first day. All theory king.
//notalone.
Agree!
If you look up Tharman’s speech in the past 10 years, you would see the method: setting up this fund, that fund to solve this problem, that problem.
This joker is using the same method again with productivity.
They call that a strategy.
what a joke!
Let look at the main cost component of a business. These are mainly manpower cost, rental of premises and utilities charges. The high cost of rental resulting from governmental land pricing policy using ‘reserve price’ has created an inflexible market pricing model. We have allowed Singapore to become a nation of landlord rather than a nation where SME can strive to support economy. With SME having to pay a fixed high premium in rentals, the only way to stay afloat is to cut the other costs that is significant. This has got to be replacing the local manpower with cheaper manpower or some sort of mechanisation.
If you were to look at the foodcourt business, individuals food stall owners are making money just to pay high rentals. The owner would either do the work themselves or employ foreigners to help them stay afloat. The high rentals is the result of the ‘over the top’ high price that landlord bidded to secure the ownership because of the reserve land price policy instituted by goverment. These high cost at a tender stage will cascade down to the high cost of doing business in Sg. So how high is high? If businesses need to pay 30% or more of its revenue to pay rent then this is deemed excessive unless this is a super luxury services where the clientele are super rich.
The land cost is the apex of all other cost as businesses need space. If a high percentage of business cost is fixed (cost arising from most rentals of premises are fixed cost), then in difficult times business is more likely to fail as it is not able to respond with a high fixed cost structure. Land cost contribute significantly to the fixed cost of all businesses either directly through long term leases or rental and indirectly through other service cost eg utilities etc.
SG Gov should seriously review how to reduce overall cost other than manpower or manpower productivity intiaitives. Do we want to become just a nation of landlord, collecting high rentals from tenant or do we want to build SME to significantly support the economy. Need to go back to 101 economics for overall cost reduction
Let’s look at the main cost component of a business. These are mainly manpower cost, rental of premises and utilities charges. The high cost of rental resulting from governmental land pricing policy using ‘reserve price’ has created an inflexible market pricing model. We have allowed Singapore to become a nation of landlord rather than a nation where SME can strive to support economy. With SME having to pay a fixed high premium in rentals, the only way to stay afloat is to cut the other costs that is significant. This has got to be replacing the local manpower with cheaper manpower or some sort of mechanisation.
If you were to look at the foodcourt business, individuals food stall owners are making money just to pay high rentals. The owner would either do the work themselves or employ foreigners to help them stay afloat. The high rentals is the result of the ‘over the top’ high price that landlord bidded to secure the ownership because of the reserve land price policy instituted by goverment. These high cost at a tender stage will cascade down to the high cost of doing business in Sg. So how high is high? If businesses need to pay 30% or more of its revenue to pay rent then this is deemed excessive unless this is a super luxury services where the clientele are super rich.
The land cost is the apex of all other cost as businesses need space. If a high percentage of business cost is fixed (cost arising from most rentals of premises are fixed cost), then in difficult times business is more likely to fail as it is not able to respond with a high fixed cost structure. Land cost contribute significantly to the fixed cost of all businesses either directly through long term leases or rental and indirectly through other service cost eg utilities etc.
SG Gov should seriously review how to reduce overall cost other than manpower or manpower productivity intiaitives. Do we want to become just a nation of landlord, collecting high rentals from tenant or do we want to build SME to significantly support the economy. Need to go back to 101 economics for overall cost reduction