Three Keys to SME Success

The world of small and medium enterprises is a world of challenges. But when it is done well and all the hard work pays off, it is also a world of thrills. How do you turn the challenges into the thrills? What do you need to do well in order to succeed? Let’s look at three areas key to any SME’s success: finance, sales and technology.

Among the many different financial challenges an SME faces, cash flow is one of the greatest. It is not uncommon for a good company with a strong business model to fail simply because it cannot meet the demands of its creditors on time.

Your invoicing process might need to be looked at, as there are many areas in which it could be improved: Is it costing you a lot of time? Can you automate the process at all using some sort of accounting software? Are your invoices clear and easily understood? Do you send them out electronically? It is important to be as efficient as possible in these areas.

Another important consideration is the credit terms you apply to your debtors. Compare how quickly you are paying your creditors with how long it is taking you to get paid. Set credit terms that work for you and try to enforce them. Consider requiring payment upfront or in tranches, or offer a small discount for payment on time. As the payment deadline approaches, follow up with customers. Send a clear message that payment schedules are not negotiable.

Now let’s talk about your creditors and, in particular, one that is common to many – the government of Singapore.

Yes, tax. How can a SME pay exactly what it owes and no more? Here are some possible tax deductions you may not have thought of:

  • Office renovations: Companies can claim deductions on the cost of renovating business premises, up to a total of S$300,000.

  • Research and development: Incentives for research and development are substantial in Singapore, but there are many requirements to meet and you may need professional advice to enjoy the full deduction.

  • Goods and commercial vehicles: Companies can claim capital allowances for vans, lorries and motorcycles acquired for commercial use as well as operating expenses such as parking fees, maintenance and petrol costs.


Many SMEs are good at selling their products or services through traditional channels, but how strong is your company in online marketing and e-commerce?

At a minimum, SMEs that are serious about using the Internet need a few basic things: a well-designed website, active and interesting social media channels, and simple ways for your customers to communicate with you electronically. With this as a basis, then e-commerce might be your next offering.

E-commerce, or the ability to sell your products or services online, is a critical element in today’s commercial world and if you are not doing it, you may be missing out on precious revenue.

One of the first things that any e-commerce venture needs is a merchant bank account. Available options include Merchant Solutions (a joint initiative between Standard Chartered and First Data) and DBS. You will also need a payment gateway to facilitate payments by customers. Here, your options include DBS d2Pay, PayPal, AsiaPay, eNETS and GTPay. Then if you plan to ship goods to your customers, you will need a fulfilment service and possibly customer service resources to support the shipment process.


Finally, having the right technology is important. The nature of your business will determine what you need to invest in, but here are two areas that are common to many SMEs.

First, cloud computing. This is the name given to the process of storing data on the Internet’s servers, as opposed to the local hard drive of your computer, tablet or phone. And it is a major growth area in all sectors of business. Whether you choose the public cloud, the private cloud or the hybrid cloud, it can no longer be ignored.

Cloud computing can help you in several ways. It can provide increased flexibility and accessibility by allowing your staff to work offsite or outside regular business hours. It allows you to minimise your investment in hardware, so that you can focus on what you are good at and leave the data management to others. There are also a number of purposebuild cloud applications that can help you to scale and streamline your business, such as accounting software QuickBooks Online, which can be integrated with many payroll, POS and e-commerce platforms.

Second, and somewhat related to the first element, is data security. This, too, is an area of increasing importance, and one that touches the security of both your assets and your customers’ assets.

Above all else, get educated about the legal obligations you must meet. The Personal Data Protection Commission is a good place to start. You can find toolkits and resources here to help your business develop a plan for the management of data breaches, notification processes and securing personal data. And, when you have established what you need to do, ask for expert help to implement it.

- QuickBooks SG -