SMEs’ “5 Pots of Gold” for 2011

By Patrick Chong

As 2010 draws to a close, we prepare to bid a welcome to 2011. Each of us has our favourite approach to “crystal-balling” 2011. We, here at ABC, offer our very own “pots of gold” for SMEs in 2011.

1. Rise of the Emerging Economies

Depending on which list (FTSE, MSCI or Dow-Jones) you use, emerging economies range from 21 to 35 different countries. Be that as it may, these economies are where companies will find their major source of growth. In

particular are China and India where the pace of economic growth far outstrip many economies, whether advanced or otherwise. SMEs will readily find opportunities in infrastructure, construction, ICT and similar sectors. These will largely be in the form of tenders put out by the various countries or development banks.

2. Migration to eCommerceIn 1990, the number of internet users stood at 16 million comprising 0.4% of world population. By September 2010 it is estimated that the number of users has grown to 1,971 million accounting for 28.8% of world population. While the brick and mortal companies are still very much evident, not being online is certainly a path that leads to eventual demise. Businesses, whether supplying goods or services, must be online to tap the growing numbers of online transactions. This is one critical point which no SMEs can afford to ignore.

3. The Senior MarketThe percentage of people aged 60 or more is set to rise for the period 2000 to 2050 in every country. For example, in 2009 those aged 60 and above comprise 680 million worldwide. By 2010, it is estimated to increase by almost 3 times to reach 2,000 million (or 2 billion). This will have important macroeconomic implications in a variety of issues. For instance, there will be opportunities to cater for the needs of this segment of society like home healthcare, pharmaceuticals, disabled services and community care facilities, to name only a few. This is also the segment of the population which has accumulated wealth over the period of their working life and thus can well afford to pay for the goods and services they need.

4. Clean technology and the EnvironmentIn the coming years, the environment will be become of increasing importance to businesses. The UN sponsored conference in Cancun, Mexico on climate change in December 2010 bear testimony to this. Renewable energy sources, conservation of water and waste treatment will take on greater importance in our daily lives. This spells opportunities for businesses that endeavour to meet growing needs for such goods and services. On a national level, opportunities are there for such technologies as wind turbines and desalination. In the households, there will be growing demands for products that conserve water, recycle paper, more efficient means of refrigerating foodstuff and energy saving air conditioning. These are only some examples of business opportunities that will be available for businesses with an innovative bend.

5. Health and WellnessIrrespective of countries, medical costs are rising. Increasing number of people is suffering ailments such as heart diseases, diabetes, osteoporosis, obesity and cancer. Researches carried out thus far have pointed to culprits like lifestyles, lack of exercise, and stress. Those in the health and wellness fields will see increasing opportunities for products and services catering to these segments. Witness the growth of spas worldwide, fitness gyms and nutritional supplements. In Singapore, the Health Promotion Board is active in promoting good nutritional and health practices to the general public in an attempt to improve general well being and stem the tide of growing medical costs.

To sum up, these 5 trends are well recognized by businesses. SMEs need to put on their thinking caps and figure out ways to take advantage of these opportunities.