Growing your SME beyond Covid-19 | Tips from our Experts

The Covid-19 pandemic has continued to impact the global economy with no signs of abating. Even in Singapore, SMEs continue to be hit by the lack of tourists, gathering restrictions and slower economic activity.

In this series, we speak to experts on some of the biggest problems experienced by Singapore SMEs during the height of the Covid-19 pandemic – particularly during the circuit breaker – and solutions that SME owners can consider implementing.

More importantly, it is even more essential for SMEs to keep looking and moving forward. Our experts will share some tips to help SME owners grow their businesses beyond Covid-19.

The first in our panel of experts is Vince Wang, CEO of BlueCell.

How to grow your SME beyond Covid-19: Advice from Vince Wang, CEO, BlueCell

Biggest problems faced by SMEs during Covid-19 pandemic

The biggest problems we saw during the Covid-19 pandemic were a drop in customer demand for retail with knock-on effects to wholesalers, and a slowdown in business operations due to need for quarantine or safe distancing measures amongst the construction and manufacturing sectors.

With a slowdown in work done or sales made, and a protracted dip with no clear end in sight, SMEs’ finances are stretched thin and payments are often delayed.

While the government has been proactive in subsidizing working capital loans to them, we foresee that SMEs will need even more financing in light of a weak economic recovery for the coming year. However, the chances of approval for further financing will be much lower by then, as their debt servicing limits will have been maxed out by loans taken this year.

While this need for financing cannot be eliminated, SMEs can tap on other means of financing such as invoice factoring or trade financing facilities that do not place such a great burden on their debt ratios while providing them with the working capital that they will require.

Tips to grow your SME beyond Covid-19

First and foremost, hoard cash. In a weak economic climate, cash is king. Therefore it’s best that SMEs tap on financing options that help them conserve cash e.g. Trade Finance which uses financing to purchase goods and only require repayment after the SMEs’ customers have repaid.

Secondly, maintain payment terms or even shorten them so as to increase the speed of capturing cash.

Last but not least, don’t be excessively cautious. Prices are deflated right now with the conservative outlook in the market, if there is a good opportunity to grow sales or make investments in future growth while in a good financial position, take it! After all, “The time to buy is when there’s blood in the streets.”

How Bluecell can help SMEs

Bluecell helps SME owners searching for financing options with its loan aggregation platform that allows SME owners to seamlessly reach multiple lenders with a single application. With Singpass and other integrations on our platform, SME owners can quickly update their financial information and explore the loans that best suit their needs e.g. invoice factoring instead of term loans to meet working capital needs. At the same time, by making use of integrations to pull data from the source, we provide lenders with the transparency that they need to accept an application.