SMEs optimistic in 2022; plan expansion—survey
Owners of small and medium-sized enterprises (SME) are optimistic about the future of the domestic economy as well as business growth prospects, as they plan to expand this year despite the prolonged pandemic, a recent study revealed.
Based on the Sun Life Business Growth and Resilience Index released on Thursday, March 31, 76 percent of SME owners expect the financial position of their business to improve this year and 69 percent expect the economic situation the country will be better.
Moreover, 86 percent of SMEs have plans to expand or grow their business, with the top plans being to expand their product offering (48 percent), digitalizing to grow the business (24 percent), hiring new employees (22 percent), and buy new businesses (20 percent).
However, 49 percent have also reported that the Covid-19 pandemic has had a negative impact on their business. Meanwhile, 15 percent said their business fared a lot better during the crisis.
Two years into the pandemic, 95 percent of SMEs claimed that they had adapted their business strategy to navigate the crisis.
Among the business strategies they adapted include adding new methods of distribution (55 percent), virtualizing the business (39 percent) and offering new products (33 percent), allowing them to capture new opportunities in a rapidly changing environment.
Meanwhile, SMEs also cited that the pandemic and health-related risks, increasing market competition, and increasing tax or regulatory burdens are the top three risks facing their businesses.
The growth and resilience index is based on a Sun Life survey of around 2,400 SME business owners in seven Asian markets, including Hong Kong, India, Indonesia, Malaysia, Philippines, Singapore and Vietnam in late 2021.
It also found Filipino business owners are optimistic about growth prospects in 2022, with a score of 67 out of 100, compared with 65 for Asia overall.
The survey was commissioned “to better understand how confident business owners feel about their growth prospects and how resilient their business is in this highly uncertain environment,” Sun Life said.
On the other hand, many of the SMEs highlighted a gap between how well protected they are and the risks they currently face.
“Considering the many challenges they’ve had to face in this pandemic, it’s great to see business owners looking to the future with hope,” Sun Life of Canada (Philippines), Inc. President Alex Narciso said.
“They likewise acknowledge that they are vulnerable to certain risks as they strive to move forward. Knowing this will help them plan their next steps properly,” he added.