27 JUNE 2017: SME News : SBF-DP SME Index
The latest SBF-DP SME Index (in a poll of more than 3,600 SMEs provided by the Singapore Business Federation and DP Information Group) indicated that SMEs are a little more optimistic about business prospects for the next 6 months, and it was the 2nd consecutive quarter that the outlook has improved. The index increased by half a point to 50.9.Although the Index indicated expected growth (>50), the reading was the lowest 2nd half reading in the last 3 years. SBF commented that the uptick was in anticipation of year-end activities and not a clear indication that the SMEs are out of the woods. There were general improvements in sentiments in all 6 industry sectors, namely: Commerce/Trading, Construction/Engineering, Manufacturing, Retail/Food and Beverage (F&B), Business Services and Transport/Storage.
The Business Services sector showed the greatest optimism, going up from 50.8 last quarter to 51.6. The Retail/F&B also increased one point to 51.3. Even though the manufacturing sector is now in positive territory with an index score of 50.1, it is still the least optimistic of the six industry sectors. It has edged up 0.4 point since the last quarter. The manufacturing sector also experienced the greatest decrease in their business expansion expectations, down from an index score of 5.65 last quarter to 5.48 this quarter. This dip comes after several quarters of sustained high levels of expansion, and this was seen as being consistent with predictions that the manufacturing sector growth would moderate in 2H 2017, partly due to dampening China demand. The recent growth in manufacturing was only within the electronics and precision engineering clusters, with the rest either contracting or moderating. SBF also pointed out on the divergence between the turnover expectations and profitability, which meant that despite expecting greater business demand, profit margins are likely to remain contracted.
The full report can be found at the website of SBF-DP SME Index.
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