Speech by Mr Teo Ser Luck, Minister of State for Trade and Industry, at the 5th EDC Conference on Monday, 25 March 2013, 9.45 a.m. at Max Atria, Singapore Expo
Distinguished Guests,
Ladies and Gentlemen,
Good Morning.
Thank you, Mr Akbar, for the warm welcome. I am delighted to join you at the 5th Enterprise Development Centre or EDC Conference today.
Introduction
The theme for this year’s EDC Conference is “Step up and Transform”. This topic is timely as we face challenging times ahead.
The global economic outlook remains uncertain in the short term. The US economy has yet to recover fully and many European countries continue to struggle with debt. However, there is a silver lining. Asia’s regional demand is expected to remain strong, and Singapore companies are in a good position to tap on these growth opportunities. Singapore’s economy is expected to grow at an average of 3 – 4% in the next decade1 - slower than in the past but still better than many other economies.
In the recent Budget, a suite of measures like the PIC Bonus, Wage Credit Scheme and Enhanced Workfare Training Scheme were announced to help SMEs raise productivity, so that they can remain competitive and capture growth opportunities – both locally and abroad. However, our SMEs need to look beyond these measures. In order to compete effectively, every SME must constantly review your business model and look into ways to upgrade your capabilities.
It’s not easy to do so, we know. Business costs are rising, customers are more demanding and technology is moving faster. Do I have the resources to upgrade my business? Where do I start? These are just some of the questions SMEs face.
The Government is aware of your challenges and we are committed to help you step up and transform.
More SMEs are seeking help from EDCs
SPRING Singapore is the government agency dedicated to help SMEs. SPRING works with partners from other government agencies such as the Singapore Workforce Development Agency (WDA) and Infocomm Development Authority of Singapore (IDA); as well as the Trade Associations and Chambers (TACs) and the Enterprise Development Centres (EDCs) to help SMEs in many different areas. These include financing, capability and management development, technology and innovation, and access to markets. Over the years, SPRING has helped many SMEs to raise productivity and be more resilient. In 2012 alone, SPRING worked with more than 5,000 SMEs to embark on upgrading projects and, together with our partners, reached out to about 120,000 SMEs.
However, we recognise that more can be done. To reach out to more SMEs, especially the micro- and small enterprises, SPRING launched the EDCs in 2005 to provide SMEs with business advisory services. The EDCs are part of the EnterpriseOne initiative, comprising a self-help web portal and a call helpdesk. Over the last seven years, the EDCs have assisted more than 70,000 SMEs. Last year, a record number of some 15,000 SMEs sought business and productivity advice from the EDCs. This is a positive sign. It shows that SMEs are interested to find out how they can upgrade themselves and grow.
One such example is BG Streets Holdings, a company that owns the license and distributorship for brands such as Disney and Cartoon Network in Singapore and Malaysia. Ms Looi Sheau Chian, the owner of BG Streets approached the EDC@Singapore Manufacturing Federation to learn more about how she could grow her business. The EDC advisor helped Ms Looi identify her company’s needs and gaps. Through the engagement, Ms Looi was able to learn about the Innovation and Capability Voucher (ICV). She subsequently tapped on the voucher scheme to engage a consultant to put in place a roadmap to build capabilities and a training plan to help employees upgrade themselves and improve productivity.
Chang Gen Medical Hall is another company that has benefitted from the EDC’s help. The heartland TCM retailer learnt about EDC services during an outreach session conducted by the EDC@NorthEast, a satellite centre established by EDC@Association of Small and Medium Enterprises. The EDC advisor recommended Chang Gen to use IT to improve its business processes. It helped the company apply for PIC to purchase IT systems to store and retrieve customer information and medical history more effectively.
BG Streets and Chang Gen’s success stories prove that no matter how big or small your company is, you too, can achieve higher productivity and build capabilities with support from our EDCs.
ISO Certification for EDCs
Just like the SMEs they help, the EDCs have also been busy upgrading their capabilities. I am happy to note that in the last two months, all five EDCs have successfully achieved the ISO 9001:2008 certification. This is an added assurance that the EDCs will provide quality advisory services consistently because of the robust systems and processes that they have put in place.
Launch of SME Centres
In addition, the EDCs will be enhanced to become integrated one-stop SME Centres. Last year, SPRING and International Enterprise (IE) Singapore embarked on a review of the strategies for the SME sector. Arising from this review, SMEs can look forward to enhanced support in three areas – greater government support to upgrade SME capabilities, help for SMEs to seize growth opportunities, as well as the creation of a more conducive business environment for SMEs. These measures were announced at the recent Budget and Committee of Supply (COS) Debate, and the new SME Centres are part of our overall efforts to build an enhanced business environment for our SMEs. Today, I am pleased to share more about these SME Centres.
From 1 April, SMEs can seek business advisory services from these SME Centres. But beyond the five SME Centres, we will also be setting up satellite centres progressively at various locations across Singapore. This way, SMEs will have more convenient access to government support. Like the current EDC@NorthEast, we are exploring for these satellite SME Centres to be hosted in the Community Development Centres. In short, we will be broadening the business advisory support that is available for SMEs.
Apart from broadening this support, we will also be deepening business advisory support for our SMEs. They will be able to access more information and seek advice on a wider range of assistance programmes from different government agencies as well as private sector partners. These Centres will also provide more in-depth services than the current EDCs, including business needs and productivity diagnosis, capability and awareness workshops, business leads facilitation, as well as guidance on tapping government grants.
For example, if you are in the F&B business with several outlets and would like to improve your business but don’t know where to start, I encourage you to visit the SME Centre. The business advisor will work through with you to understand your business, challenges faced and help you identify areas of improvement.
For instance, the advisor may highlight that the immediate challenge facing the F&B business is to optimise manpower and centralise kitchen operations. Subsequently, advice will be given on how to tap on suitable schemes such as the Innovation and Capability Voucher (ICV) Scheme to provide a $5000 voucher to support the hiring of industry experts to help you plan the setup. At the SME Centre, the advisor will also guide you on the application process.
To ensure that help from various government agencies remain easily accessible to SMEs, the SME Centres will continue to work closely with government agencies such as the Inland Revenue Authority of Singapore (IRAS), WDA, IE Singapore and others.
An example of this partnership is the PIC Clinics that were jointly organised by the EDCs and IRAS. More than 700 SMEs benefited from these clinics. With the good response from SMEs, a new run of the PIC Clinics started in January this year. This allows more SMEs to seek advice on how to file tax claims for productivity and innovation expenditure making full use of the PIC scheme.
We are also aware that cash flow management and the ability to secure financing are two of the main financing challenges SMEs face2. One of the first initiatives that the SME Centres will organise is with The Association of Banks in Singapore (ABS) to run 1-to-1 Financial Management Advisory Sessions. SMEs can look forward to learning how to use the free Financial Management Toolkit, to analyse your current financial situation and get tips on how to better manage your financial resources. This advisory session is open to all SMEs and we welcome you to participate.
Conclusion
Since its inception, our EDCs have played an important role in helping our SMEs access government support and business advisory services. In today’s challenging economic environment, we have stepped up the support that we will provide for SMEs, and the SME Centres are a good example of this.
With the new SME Centres, SMEs will have better access to help in the form of advisory, workshops and a whole suite of services, to improve their productivity and raise capabilities. I urge all of you to fully leverage on the schemes and resources available to step up, transform and grow your business.
I wish everyone a fruitful time at the EDC Conference. Thank you.
1 Ministry of Trade and Industry Growth Forecast, http://www.channelnewsasia.com/stories/specialreport/news/1259178_191/1/.html
2 DP Info survey (2011)