BUSINESS

Malaysian mid-market enterprises expect sales to grow by 15-20 pct in 2023

10/11/2022 11:51 AM

KUALA LUMPUR, Nov 10 (Bernama) -- Thirty per cent of mid-market enterprises (MMEs) expect sales to grow between 15 per cent and 20 per cent in 2023 with another 25 per cent expecting sales to grow even more despite softening economic growth globally, according to HSBC Bank Malaysia Bhd’s Business Balancing Act (BBA) survey.

The survey polled a total of 171 chief executive officers and chief financial officers from rising and established Malaysian MMEs with an annual turnover of between US$10 million to US$500 million. (US$1: RM4.71)

A majority of these MMEs are from the manufacturing, retail, digital and financial services sectors.

The research, carried out for HSBC by polling company Toluna, found that the optimism of sales growth in 2023 stemmed from more than half (56%) of the MMEs introducing new products and services and technology-driven efficiencies in their operations (53%). 

The ability to attract investments and secure financing for their business (50%), and increasing domestic demand (49%) were the two top drivers of their optimism.

The statement said the major threats to business growth next year are inflation and the higher cost of living (63 per cent), rising interest rates (44 per cent) and uncertainty in the political environment (43 per cent).

Seventy-two per cent of those surveyed cited that building up adequate cash flow and effective capital management will be their investment priorities over the next 12 months.

They will also prioritise investments for marketing products and services (68 per cent), and investments that enhance customer experience (66 per cent).

On how their plan to grow their business, 67 per cent said they will seek external investments, 29 per cent plan acqusitions. Divestments are not favoured next year.

“However, a major challenge cited by 63 per cent of the MMEs when it comes to making viable investments are cost cutting exercises which are expected to be prevalent due to the tougher economic conditions next year,” HSBC said.

HSBC Malaysia head of commercial banking Karel Doshi said MMEs are significant drivers in the Malaysian economy, and their optimism is a positive sign.

-- BERNAMA


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