THE disruptions faced by companies over the last few months have prompted a move to rethink business models and whole industries, which could open up new opportunities for SMEs.
Khazanah Research Institute senior advisor Dr Jomo Kwame Sundaram observes that shifts in supply chains and priorities will lead businesses to move up the value chain or tap new industries.
For example, with growing concerns about food security, he points out that it is time to push for better vegetable production for the local market. This could mean opportunities for small businesses in the agriculture sector.
However, companies should not only try to tap a new product for more sales.
They should also look at ways to maintain good practices and standards to be competitive.
“It’s not a secret that for much of the food produced in Malaysia, we use excessive amounts of agrochemicals and we are only informed about this usually when our vegetables and fruits are rejected by other countries. This should not be the case, we should also be concerned about Malaysians’ health.
“We need to use this opportunity. And we should also come out of this a much better and healthier society, by taking into consideration many of these factors, ” he says.
Jomo was sharing his thoughts during the launch of The Star Outstanding Business Awards (SOBA) 2020 last Thursday.
He adds that as SMEs make the transition to more robust and sustainable businesses, the government plays an important role in supporting them to make the transition easier. This includes helping them with retraining workers for different types of positions or to produce different types of products or services.He also notes the need to encourage more domestic investments.
“It’s very important for us to give greater priority to the development of Malaysian companies and the only way to do that is by testing, encouraging and helping these companies, especially SMEs, not in sunset industries or services, but in activities that offer much for the future.
“We need to think of new areas in which we can encourage entrepreneurs to go into and help them by developing necessary skills.
“For example, in solar photovoltaic systems, the technology involved is fairly straightforward. And we produce them. But we need the skills, experience and marketing, most of which are provided by foreign companies. None of the major exporters are Malaysian companies. So what can be done to help Malaysian companies become internationally competitive?
“These are the kinds of activities we need to promote and we need to make some tough decisions by identifying goods and services which have hope for the future and find some exit strategies to reduce the pain of exit for those industries that are not going to go very far, ” he says.
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