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FINANCE 
• Global financial crisis have caused 
financial institutions to be more 
cautious and credit processing has 
bec...
“Our traditional and biggest obstacle has always been in financing our 
projects. Despite our management skills, variety o...
“Our business is all about the talents that we have. Whilst the 
largest investment may be in the technology and equipment...
Ken Kang, Managing Director of Wah Ha Children Products Sdn Bhd said, 
“In 2010, we faced stiff business challenge due to ...
Competition from lower cost producing 
countries of China, Vietnam etc. 
Lack of expertise in export marketing 
Lack of vi...
Financial Constraints to Acquire ICT & New 
Technology 
Lack of Expertise on ICT complexities 
Lack of ICT Technical Staff...
Discuss the challenges faced by SMEs in Malaysia.
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Discuss the challenges faced by SMEs in Malaysia.

“While the government continues to encourage small and medium scale players, there may also be a need to consider steps to consolidate among the many vendors in the automotive industry, in order to gain scale, financial strength and managerial talent to expand internationally.”

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Discuss the challenges faced by SMEs in Malaysia.

  1. 1. FINANCE • Global financial crisis have caused financial institutions to be more cautious and credit processing has become so complex, that very often SMEs find it difficult to both understand the procedures and decisions when it comes to loan processing. HUMAN CAPITAL • Severity of the brain drain, especially among professionals and skilled workers. MARKET • Increase in competition. • Rising cost of goods. • The increase in uncertainty in the market. Businesses have to reduce costs and improve productivity in the midst of adapting to changing market conditions. TECHNOLOGY • Challenge to acquire or develop new technology. • Many of the leading research and technological developments are coming out from Europe and North America. Finding partners and vendors who are willing to transfer these technologies to Malaysia is tough enough let alone transferring these technologies to SMEs.
  2. 2. “Our traditional and biggest obstacle has always been in financing our projects. Despite our management skills, variety of profitable projects and great plans – none of it will work without money” Robert Michael of vacuum and compression solutions provider, Airo-fluid Sdn Bhd. “As we continue to grow, we require additional capital and financing power for expansions which are not easy to come by as an SME” Cheng Nyek Paw of Bennova Mechanical Engineering Sdn Bhd. Rick Cheng, CEO of property developer Encomas Sdn Bhd couldn’t agree more when he said, “it’s financing, financing, financing. It is getting harder to secure financing from banks and they always set very high requirements for us to achieve in order to get financing.
  3. 3. “Our business is all about the talents that we have. Whilst the largest investment may be in the technology and equipment, without our people, we will not be anywhere near where we are today,” said Lim Boon Siong, CEO of Vista Vision Specialist. Alan Hoo of image consultants Chapter One Asia agreed, saying, “finding the right candidate at the right time and the right price is like striking a lottery. Most capable young adults would prefer to work in MNCs as it looks more promising, not to mention more glamorous; making smaller organizations like us difficult in finding suitable candidates”.
  4. 4. Ken Kang, Managing Director of Wah Ha Children Products Sdn Bhd said, “In 2010, we faced stiff business challenge due to significant drop of purchasing power of domestic consumers. Our challenge in 2011 will be to build up the confidence of consumers and regaining their purchasing power”. World Prominence Sdn Bhd’s Ahmad Fauzi Kari said that his company’s biggest challenge would be to manage the cost of doing business. “For us, high and cyclical raw and packaging materials cost, increase in other operational cost such as labour cost, utility cost and distribution cost are putting tremendous pressure on us. Passing the increased cost to the customers is not an easy task either,” he said.
  5. 5. Competition from lower cost producing countries of China, Vietnam etc. Lack of expertise in export marketing Lack of viability to export small quantities to overseas Source : Mr. Chua Tiam Wee National President Small and Medium Industry Association of Malaysia
  6. 6. Financial Constraints to Acquire ICT & New Technology Lack of Expertise on ICT complexities Lack of ICT Technical Staff Time and Effort to Learn to migrate to New Technology High Software Licensing fees Difficulties in Choosing the Right technology Fear of Unreliability, Cyber Security, Data Loss. Source : Mr. Chua Tiam Wee National President Small and Medium Industry Association of Malaysia

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