SMEs don't expect much of a push from lower fuel prices, survey finds
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Despite lower fuel prices, small and medium-sized enterprises foresee difficult prospects for business growth this year because of fewer sales and less profit, a survey by the University of the Thai Chamber of Commerce has found.
According to the UTCC survey of 1,450 SMEs, in the current first quarter of the year, just over half (50.3 per cent) foresee their business growing at the same rate as last year, 30 per cent foresee lower sales, and only 11 per cent predict higher sales and profit.
Thanavath Phonvichai, director to the UTCC’s Economic and Business Forecasting Centre, said most SMEs foresaw difficult business growth this year as they lacked financial liquidity and were unable to access the required funding.
“Despite dropping fuel prices, SMEs have problems competing because of higher costs of operations and lack of liquidity to expand their businesses,” he said.
Thanavath suggested the government relax some financial regulations, such as to allow SMEs to use their orders as a guarantee for loans from banks, in lieu of collateral.
SMEs that will face tougher competition this year are mostly in manufacturing sectors such as fashion and apparel, food and beverages, and retail and wholesale.
The survey also found that 58 per cent of SMEs were able to compete at only the sub-district or tambon level, 32.4 per cent could compete in their district or province, 2.6 per cent could compete at the national level, and only 0.4 per cent could compete internationally.
