Two-thirds of businesses find pace of economic restructuring too fast
- POSTED: 21 Jan 2014 21:21
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Two-thirds of businesses in Singapore surveyed find the pace of economic restructuring too fast and that immediate cost and labour concerns come at the expense of innovation and brand development.
SINGAPORE: Two-thirds of businesses in Singapore surveyed find the pace of economic restructuring too fast and that immediate cost and labour concerns come at the expense of innovation and brand development.
Audit firm KPMG said regulations and tax incentives in the upcoming budget could be further simplified.
According to a study by KPMG, productivity measures are beginning to bear fruit.
Some 65 per cent of 159 businesses surveyed said they have been able to improve equipment and labour productivity but companies' focus on immediate cost and labour concerns are compromising value creation activities.
Tay Hong Beng, head of tax at KPMG in Singapore, said important operational matters such as looking for an external market and looking at an innovative way of doing things may be neglected.
In its budget wishlist, KPMG is asking for tax and monetary incentives to reward innovation and brand development among Singapore businesses.
Mr Tay explained: "Branding creates that kind of niche that you have in the market itself. So if you're looking at going abroad beyond Singapore shores, to explore market overseas, you need to have strong brand.
"And it's only with strong brand and innovative ideas that you can actually garner much more business for yourself and not just competing based on costs."
The Singapore International Chamber of Commerce, who supported the survey, said the drive for innovation among Singapore businesses will stand them in good stead as they compete to move up the value chain of their multinational clients.
Phillip Overmyer, chief executive of Singapore International Chamber of Commerce, said: "There are a lot of other opportunities throughout Asia so the companies are trying to find the best way for each of their operating capabilities to get the right thing set up.
"Instead of saying everything is being done in Singapore, we will say the high-end things are being done in Singapore, and other things are being put together at different levels throughout Asia."
Meanwhile, some 45 per cent of respondents also want tax and monetary incentives to be simplified and allow more flexibility.