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HK's SMEs bullish on exports fuelled by e-commerce potential: FedEx

HONG Kong's small- and medium-size enterprises (SMEs) remain broadly optimistic towards export prospects amid global economic volatility, according to a recent global research study commissioned by FedEx Express (FedEx), a subsidiary of FedEx Corp.

Of the 500 senior executives of local SMEs, 82 per cent saw steady or increased export over the past year, generating an average of HKD9 million (US$1.2 million) in revenue, which accounts for more than two-thirds of their overall revenue. More than a third even forecast an average double-digit growth of 17 per cent in the year ahead. SMEs are particularly bullish on intra-regional export, with 49 per cent anticipating 17 per cent revenue growth on average.

"As the study shows, the SME sector continues to demonstrate strength and perseverance as they steadily weather the macroeconomic environment," said Anthony Leung, managing director, FedEx Express, Hong Kong and Macau.

"Today's economy is changing faster than ever. It is imperative that businesses eye not only their home market but also the world to expand income sources and build resilience in good and bad times. One essential way to do so is e-commerce as it opens up a world of opportunities for businesses large and small."

The study shows the sense of optimism among the SME community is largely fuelled by e-commerce potential. In Hong Kong, eight out of ten SMEs are already engaged in e-commerce, generating an average revenue of HKD2.7 million a year. Their confidence in e-commerce continues to increase: more than two-fifths foresee growth in e-commerce income in the coming year.

Despite this, Hong Kong is lagging behind in e-payment development, leading to relatively slow mobile commerce (m-commerce) and social commerce penetration. Currently, 56 per cent and 73 per cent of local SMEs are generating revenue through m-commerce and social media transactions respectively, versus a much higher proportion ?94 per cent and 88 per cent respectively ?in neighboring mainland China.

To maintain its competitiveness, it is crucial for the city to catch up on mobile payment and peer-to-peer (P2P) solutions through government policy, technology and interbank infrastructure, the report said.

Thirty-nine per cent of Hong Kong SMEs cited increasing international competition as a top challenge. To navigate this new competitive landscape, SMEs are looking to logistics providers. In Hong Kong, 95 per cent of SMEs agree logistics plays an important part in their export business. An efficient supply chain is vital to enhancing the customer experience and managing costs, thus helping win customers and improve bottom lines.