SMEs ready to meet higher export demand
PETALING JAYA: Local SMEs, particularly export-oriented companies, are in a good position to meet the increasing demand that is expected to come into the region due to the ongoing US-China trade war.
Deputy International Trade and Industry Minister Ong Kian Ming said these firms are experienced and well prepared to take advantage of this opportunity.
“Many of them are already part of the global supply chain, supplying to many parts of the world. They are ready.
“The trade war increases the level of interest from Chinese companies to diversify their supply chain here.
“For example, the Hong Kong Trade and Development Corp last week brought in a group of plastic manufacturers to see if there are opportunities for them to work with local suppliers to diversify their supply chain. “Most of these (orders) are part of the SME supply chain. There are many other sectors that SMEs can benefit from the trade war,” Ong said at the launch of the Platinum Business Awards 2019 (PBA2019).However, SME Association of Malaysia president Datuk Michael Kang noted that the majority of SMEs are still domestic-driven.
For these companies, it is important for them to find innovative ways to build up their capabilities and their capacity to cater to a surge in demand and meet international market standards.
“They can be ready through innovative processes. For example, when it comes to the labor shortage issue, they can do what we call the ‘sharing economy’, where producers can outsource some of their manufacturing to rural areas.
“That way, they overcome their own labor shortage by leveraging others.
“SMEs need to be innovative so that they can overcome whatever challenges to take advantage of the trade war,” he said.
Apart from labor shortage, Kang highlighted that other challenges often faced by small businesses include marketing and technology adoption.
Ong said the ministry has selected 66 companies to undergo its complimentary readiness assessment for Industry 4.0, which will start next month.
The PBA2019 are business awards that benchmark business performance and quality standards of SMEs in the areas of products, branding and operations.
A total of 23 award categories are up for grabs this year, including two new categories: the SME High Productivity Enterprise and SME Product Packaging Excellence.
“We hope these categories will spur SMEs to step up their game and participate in the PBA to benchmark their performance and quality standards,” said PBA2019 organising chairman Alan Tan.