Half of Taiwan SMEs predict recovery in 2010
TAIWAN, June 9, 2009 - Fifty percent of Taiwan
small-to-medium enterprises have expressed optimism that the global economic
recovery will take place in 2010. These SMEs also indicated that given the
current economic condition, they are adjusting their existing business model and
are looking at three key areas as growth opportunities: move to higher
value-added products and services (44 percent), explore new markets (14
percent), and strengthen the workforce with good talent (10 percent), according
to the latest UPS Asia Business Monitor (ABM) 2009, an annual survey on the
competitiveness and issues facing SMEs in the Asia Pacific region.
This year's ABM survey reveals the overwhelming impact of the current
economic downturn to SMEs across the region. To counter the effects of the
global recession, Taiwanese SMEs have identified the IT, manufacturing, and
biotechnology sectors as the key economic pillars for Taiwan over the next three
to five years.
Only six percent of Taiwanese SMEs expect economic growth in 2009, which is a
sharp decline from 72 percent in 2008. From a regional perspective, just 15
percent of Asian SMEs estimate that the region's economic outlook in 2009 will
be better which is significantly down from 60 percent in 2008.
As for overall business, Asian SMEs have expressed a less positive view with
only 25 percent expecting better prospects in 2009, compared to 63 percent in
2008. Taiwan SMEs indicate the same sentiment as only 23 percent believe their
company's development will be better in 2009 vs. 64 percent in 2008.
Reflecting the current economic turmoil, the top three business issues that
keep Taiwanese SME owners up at night include the market slowdown/economic
downturn (81 percent), increasing costs (51 percent), and cash flow/rising debt
(41 percent).
SME's plans to sustain business and counter the effects of a global economic
recession rely most heavily on reducing costs (78 percent), tightening cash
management flow via strict credit control and collection plans (69 percent), and
diversifying and/or exploring new revenue streams (64 percent).
Despite recent cross-strait developments, the survey shows that 65 percent of
Taiwanese SMEs will not increase investment. However, 10 percent of Taiwanese
respondents will increase their investments in China, 8 percent will invest more
in Taiwan, and 9 percent will increase investments in both markets.
"UPS has been recognized for conducting this survey since 2005 as a means of
shedding light on the real issues facing SMEs in Asia and supporting their
growth. Our fifth annual survey revealed how the recent economic turmoil has
brought SMEs many challenges in future development. However, with UPS's
experience working with customer, opportunities still exist. In such a bleak
period, UPS recommends SMEs to tread carefully and avoid coming to a grinding
halt. Instead they should re-examine their basic operations and update their
business models," said Gary Wu, General Manager of UPS Taiwan.
"Flexible Love, an experimental furniture company and a valued UPS customer,
is a perfect example. The company has leveraged product innovation to construct
a brand new business process that improves supply chain efficiency from sourcing
to fulfillment with outstanding results. They now save NT$1.68 million per
month, not counting savings on manpower, and their clients enjoy value-added
service quality and provide Flexible Love with a strong competitive edge. This
is the ideal fulfillment of what we advocate as SQUAT Management where S stands
for systematic business process, Q for quality product, U for union with
partners, A for added value for clients, and T for timely market response. Using
this method, companies are better equipped to meet market challenges head on,"
Wu added.
The UPS Asia Business Monitor
Since its launch in 2005,
the UPS ABM has been conducted annually to deliver the latest insights on the
changing business needs of SMEs, the largest business community in the region.
As discussed at the 3rd APEC Business Advisory Council Meeting in August 2008,
SMEs make up 95 percent of all businesses in the Asia-Pacific region and employ
80% of the workforce. This year, the UPS ABM 2009 surveyed 1,200 company owners,
proprietors, CEOs, Managing Directors and other top management across 12
markets.
UPS
UPS (NYSE: UPS) is the world's largest package
delivery company and a global leader in supply chain and freight services,
offering an extensive range of options for synchronizing the movement of goods,
information and funds. Headquartered in Atlanta, Georgia, USA, UPS
serves more than 200 countries and territories worldwide. UPS's stock trades on
the New York Stock Exchange (UPS) and the company can be found on the Web at www.UPS.com. To get UPS news direct, visit
pressroom.ups.com/RSS.
Notes to Editors
- UPS Asia Business Monitor series provides the latest insights into the
changing opinions, attitudes and habits of business leaders from the region's
small and medium sized enterprises
- UPS Asia Business Monitor 2009 surveyed 1,200 decision makers of SMEs
between January 8, 2009 and February 27, 2009. Interviews were conducted by an
independent research organization, TNS, using the respondents' native language.
SMEs are defined as companies with fewer than 250 employees
- Interviews were conducted in the following 12 markets: Australia (100
respondents), China (150), Hong Kong (100), India (100), Indonesia (50), Japan
(100), Korea (100), Malaysia (100), the Philippines (100), Singapore (100),
Taiwan (100) and Thailand (100)
- Respondents were from a range of industries: automotive, garments &
textiles, healthcare & pharmaceuticals, toys & sporting goods,
electronics & electricals, gifts & housewares, timepieces, jewellery
& optical goods, and others
- The average SME has been in business for nearly 22.6 years
- Graphs and charts from the UPS Asia Business Monitor 2009 are available by
contacting Maggie Huang at Ogilvy Public Relations Worldwide on +02 37251221/maggieyc.huang@ogilvy.com
or Isabel Chen at UPS Taiwan on +02 28809325/iichen@ups.com
- The full ABM 2009 presentation deck is also available at www.ups.com/abm
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