South Korean small and medium enterprises (SMEs) expect this year’s sales to remain unchanged or dip compared to 2013, a poll conducted by the lobbying group for large conglomerates showed Wednesday.
The survey, carried out on 690 companies in September by the Federation of Korean Industries (FKI), revealed that 36.5 percent of the 326 respondents predict sales figures will be on par with last year, with 34.1 percent anticipating lower sales.
Of the companies asked, only 29.4 percent of SMEs expected sales to go up for the whole of this year.
“The fact that seven out of 10 companies do not expect improvements in sales is a sign that weak consumer demand and unfavorable exchange rates are exerting adverse impact on the business climate,” the FKI said.
In particular, SMEs were slightly more pessimistic about prospects for the second half vis-a-vis the January-June period.
The survey showed 32.8 percent of companies bracing for a dip in sales through the end of the year versus 31.6 percent of SMEs that expect some improvements.
The survey also showed SMEs are focused on finding new markets and building up their capability to generate growth and overcome adversity.
Of the companies surveyed, 39.9 percent said they aim to expand into new territory, while 24.5 percent said they would pay more attention to fortifying their capabilities.
In regards to strengthening their general competitiveness, 35.9 percent of SMEs said there is a need to enter new markets at home and abroad, with 18.6 percent stressing the importance of technological innovation.
Commenting on the poll, Yang Geum-seung, director of the FKI’s SME business cooperation office, called on the government to take steps to stabilize the foreign exchange market and inject more funds so as to bolster the domestic economy. He, moreover, called on policymakers to do away with excessive administrative red tape to make it easier for companies to do business. (Yonhap)
