Making up 98% of the city’s businesses, Hong Kong’s 340,000 SMEs can use all the help they can get
Hong Kong is famous for being an easy place to set up a business. But, I have to confess, until I read a story in a local newspaper the other week, I didn’t realise quite how deeply ingrained the idea of running your own business actually is.
According to the paper, last year Hong Kong was home to 340,000 small- and medium-sized enterprises (SMEs). That represents 98% of all the businesses operating in the SAR.
In fact, SMEs are the unsung heroes of most economies. One Hong Kong-based think tank, the Asia Global Institute, estimates that around the world, SMEs account for about 90% of all jobs. According to the IMF, while the amount SMEs contribute to national GDP varies significantly across Asia – lowest in India (17%), highest in Singapore (65%) – Hong Kong sits somewhere in the middle at 41%.
You can see why the Hong Kong Trade Development Council welcomed the new measures announced in 2019-20 Budget to develop Hong Kong’s economy by supporting local start-ups and small and medium-sized enterprises. Because, unlike their bigger and better financed corporate cousins, SME’s need all the help they can get, particularly when it comes to meeting IT challenges.
Still Plenty Of Pain Points
Bigger businesses typically have sizeable budgets and IT teams to take care if their technology. It’s the opposite for SMEs.
⦁ Finances – Traditional on-premises solutions can also be a great financial burden, being both expensive to buy as well as costly to operate.
⦁ Scalability – Keeping up with new developments and simply accommodating growth can be a complex and expensive proposition, which ends up limiting growth.
⦁ Reliability – Most SMEs neglect of can’t afford the back-up and disaster recovery protection that bigger companies take for granted, which means a single incident could cripple their business.
Cloud Is Levelling The Playing Field For SMEs
Fortunately, the cloud revolution is ironing out some of these disadvantages for SMEs.
A case in point is Enterprise Resource Planning (ERP) solutions, which in simple terms help to streamline and condense data from several departments into one platform, allowing for better decisions and increased productivity. However, over the last decade or so, a lot of smaller companies have been put-off ERP by the perceived cost and complexity.
Instead, small business typically uses cheaper tools – from spreadsheets to simple accounting software. That’s fine at first when the company is small and business volumes are modest. However, as they grow in size and complexity, so does the risk of all kinds of problems, such as lost orders, inventory hiccups, invoicing delays and the general chaos that comes from an overall lack of control.
ERP eliminates all of that, helping to maintain consistency, saving time, and enhancing productivity. The question that SME’s used to face was at what point should make the decision to switch from the tools they used as a start-up, to an ERP that can take them from a being a small fish to a big one.
New cloud solutions make that decision unnecessary. Instead of missing out on technologies that have traditionally been regarded as the sole preserve of big, multinational businesses, they can use ERP from the beginning, efficiently and cost-effectively.
If you’d like to learn more about SAP Business ByDesign, watch the 3-min video below
Tailor Made For Small Businesses
SAP’s take on this is what we call Business ByDesign ERP – a comprehensive, cloud-based, designed to provide SMEs with all the benefits of a large-scale business application, without the need for a full-scale IT department.
Pre-configured business processes make Business ByDesign quick to implement, easy to use, flexible and capable of growing alongside the business. The intuitive software and user-friendly interface are tightly integrated with familiar Microsoft Office applications for easy adoption and increased productivity. And, because it is delivered on-demand, and managed by SAP, there is no need to worry about up-front capital costs, maintenance, or upgrades.
Customers also save a bundle on Hong Kong’s ferociously expensive office space, electricity and air conditioning that racks of physical servers require.
SAP is only for large corporations? Absolutely not. Watch the video now!
A Silver Lining For SME Business Challenges
With so much riding on their success, it is important that Hong Kong’s SMEs have access to every advantage the cloud revolution offers, so they can compete with their larger commercial cousins.
In fact, it’s essential if Hong Kong’s want’s to hang on to its legendary reputation for entrepreneurial spirit.