Hong Kong – Amidst a looming fifth wave of COVID-19, small and medium enterprises in Hong Kong are confident that they will overcome it, according to the data collected by dual studies conducted by CPA Australia.
The data shows that in order for these SMEs to overcome the fifth wave, small businesses may need to increase their investment in technology and innovation, and reset their business strategy. In it, 55% of respondents to the March poll were confident that their business or employer will overcome the fifth wave, with 57% expecting revenue will largely remain the same as normal or grow in the next three months.
Meanwhile, 42% of respondents believe that the relaxation of social distancing restrictions will have the most positive impact on their SME in the next three months, followed by the Employment Support Scheme (18%) and Consumption Voucher Scheme (12%).
Lastly, when asked which areas of their business were most negatively impacted by the fifth wave, over one-third (35%) nominated business operations, followed by cash flow (26%).
Janssen Chan, chairperson of CPA Australia’s SME Committee for Greater China said, “We are aware that many small businesses are suffering during the fifth wave of COVID-19, but they are also demonstrating resilience and adaptability during this period.”
He added, “The pandemic is a major catalyst for transforming business models and consumer spending patterns. In Hong Kong, more consumers are purchasing online and using digital payments. With social distancing restrictions set to relax from mid-April and the roll-out of stimulus measures such as the e-consumption vouchers, small businesses should continue innovating, digitalising and updating their business plans to ensure they are best placed to rebound in the second half of 2022.”
There was also an increase in the number of local businesses that found their investment in technology in 2021 improved their profitability (40% in 2021 compared with 25% in 2020). Revenue generated from e-commerce also increased. Over half (53%) generated more than 10% of their revenue from e-commerce in 2021, the highest result for the city since 2017.
“Although Hong Kong small businesses overall may still fall short of the survey average in technology adoption, another positive to emerge from the 2021 results was that more small businesses embraced digital transformation. This bodes well for the future with the survey results showing that high growth small businesses are significantly more likely to be using digital technologies in many aspects of their business,” Chan concluded.
