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Stronger Business |
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The global business landscape has changed drastically over the past 2 decades. This is particularly so for SMEs. In Europe, the establishment of the European Union in 1993 along with the introduction of the euro in 1999 has significantly reduced trade barriers and created an environment that promotes commerce between enterprises of member countries. With the ease of trading and improved market access, many SMEs benefited greatly and enjoyed promising business growth. In the past 5 years however, market saturation and intensifying competition in certain industries have led to many European enterprises, including many SMEs, exploring opportunities in Asia.
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In contrast, Asian regimes seem to lag behind their European counterparts in promoting the development of SMEs. The general recognition of the strategic importance of SMEs in enhancing economic resilience came about only after Asia learnt a painful lesson with the mass withdrawal of foreign direct investments in the 1997 Asian Financial Crisis. Among the 4 Asian Tigers, Hong Kong has since established the Growth Enterprise Market, emulating London’s Alternative Investment Market which provides a listing avenue for young enterprises; Taiwan, despite political differences, is leveraging on common cultural roots and strengthening its business ties with China; South Korea is continuing its extensive reforms in both the regulatory framework and the banking sector to boost operational conditions for enterprises; while Singapore has several government agencies dedicated to assisting SMEs in addressing specific issues such as internationalisation and financing.
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The various measures have contributed to the growth of SMEs in the region. Financial institutions are also taking a fresh look at enterprise banking, coming up with new products that offer greater flexibility and cater to the unique requirements of SMEs. However, many challenges lie ahead. At the broad level, governments still face the constant dilemma between a laissez faire approach or interventionist policy to support SME development. At the micro level, SMEs face critical issues in their operations. With limited asset bases, it is difficult for SMEs to obtain favourable financing. Basel II requirements have further complicated the administrative procedures involved. In human resource, talent development and retention is tough as most people prefer to work in larger corporations. Technology adoption and market access remain difficult due to financial constraints and differing risk appetites. To overcome these challenges, SMEs should tap on available governmental support schemes and make the most out of them, using them as stepping boards.
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At Evolve Maximus, we aim to assist SMEs in developing more robust business models by Innovating Thought Processes and bridging gaps between SMEs, government agencies and financial institutions. Our strategic partnerships have put us in a privileged position, allowing us to offer a holistic suite of advisory services. Our specially designed Capability Enhancement Programmes (CEPs) cover topics ranging from balance sheet management and financial budgeting to financial spreadsheet modelling and listing preparation. To date, more than 500 enterprises have benefited from our financial and strategic management services. I am also pleased to announce that we have achieved a 9 out of 10 satisfaction index. Among our continual innovation on new ways to benefit our valued SME clients are the Parachute Test and Vector Index SME Retailer Financing Study. The former explores SMEs’ sustainability to sudden economic shocks while the latter is a study that analyses the banking dynamics of SME retailers.
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With regional business landscape changing at a rapid pace,
we believe that new challenges will surface. Profitable SMEs will embark on internationalisation plans with the popularity in franchising and licensing set to rise. On the other hand, SMEs that are unable to keep up will be eliminated by the harsh reality of competition. Evolve Maximus
is committed in the continual search for new and
innovative solutions that bring value to our
clients.
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