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Enhancements to ESG support schemes to bolster business recovery: Chan
THE retail sector's road to recovery will be challenging due to cyclical and inherent structural challenges, which necessitates their taking action to transform now, said Trade and Industry Minister Chan Chun Sing on Monday, where he also announced a host of enhancements to support schemes available for businesses.
Specifically, funding support for the Market Readiness Assistance Grant will be increased to up to 80 per cent from Nov 1 to Sept 30, 2021 to encourage businesses to internationalise. The scope of this grant will also be expanded to include support for participation in virtual trade fairs.
Meanwhile, the enhanced support for the Enterprise Development Grant and Productivity Solutions Grant (support levels for both are up to 80 per cent) will be extended for another nine months to Sept 30, 2021.
Support levels for all three grants will revert to 70 per cent thereafter.
Meanwhile, the Temporary Bridging Loan Programme (TBLP) and Enhanced Enterprise Financing Scheme for Trade Loans (EFS-TL) will be extended for another six months.
Under this extension, the government's risk-share on the TBLP loan will be lowered to 70 per cent from 90 per cent currently, with the maximum loan quantum reduced to S$3 million from S$5 million currently.
The extension of the EFS-TL programme will see the government's risk-share on the loan lowered to 70 per cent from 90 per cent currently. The maximum loan quantum will remain at S$10 million.
Finally, the Enterprise Financing Scheme - Project Loan will be enhanced to extend support to construction companies to finance the fulfilment of secured domestic projects from Jan 1, 2021 to March 30, 2022.
"All the schemes that we are rolling out are not just to help companies tide through the cyclical challenges," said Mr Chan. "More importantly, we hope our companies and our retailers will be able to use this help to help them pivot to new products and new markets, so that they have a new growth trajectory beyond Covid-19."
He also outlined three actions that retailers can take as they build a new growth trajectory. These comprise distinguishing themselves beyond arbitrage, exploiting the larger market beyond Singapore via digital means, and seeking to create greater value through intangibles such as service and design.
Indeed, retailers need to adjust to new consumer behaviour and create new unique selling propositions to be competitive, said Mr Chan, following a visit to SK Jewellery Group.
An example of this is SK Jewellery's successful launch of the Star Carat in October 2019, the company's sub-brand for lab-grown diamonds. By disrupting its traditional business, SK Jewellery successfully reached a new group of consumers who are increasingly conscious of the environmental and social impact of their purchase decisions.
To reach an international market, retailers should leverage digital platforms which have become a new avenue to diversify sales channels and expand abroad, said Mr Chan. Businesses can leverage the Grow Digital Initiative to seize business opportunities overseas through B2C and B2B e-commerce platforms.
Finally, retailers should seek to create value through intangibles such as service and design. As consumers increasingly seek more customised and personalised experiences beyond just the product, retailers should leverage this to differentiate themselves and set their brands apart.
The retail sector contributes about 1.6 per cent of Singapore's GDP and provides employment to 4.1 per cent of the workforce. The sector, which comprises about 26,600 establishments, saw sales severely affected during the "circuit-breaker" period, with an unprecedented year-on-year slump of 52.1 per cent in May.