Taiwan small businesses cautious, digital payments fall behind counterparts in Asia-Pacific

2019-06-05 10:01 1635

TAIPEI, , June 5, 2019 /PRNewswire/ -- Taiwan small business confidence in the local economy is weak and expectations for growth in 2019 are low, according to CPA Australia's 10th annual Asia-Pacific Small Business Survey.

The findings follow extensive surveying of over 3,600 small business operators in ten markets, including Taiwan, Hong Kong, Mainland China, Vietnam and Australia.

Overall, conditions for small businesses in Taiwan were weak in 2018, with 57 per cent reporting that they grew in 2018, below the average of 66 per cent in the region. This negative sentiment is likely to continue in 2019, as only 44 per cent of Taiwan respondents expect the local economy to grow this year, however local small businesses are more confident in their own performance with 63 per cent expecting their business to grow. Only about 10 per cent of respondents expect the revenue from overseas markets to grow strongly this year.

Mr Elic Lam, Honorary Taiwan Advisor of CPA Australia says that as an export-oriented economy, the ongoing trade tensions is a major concern for Taiwanese small businesses.

"Over 40 per cent of respondents believe the trade war will have a negative impact on their business. Only 29 per cent of respondents expect to add staff in 2019, reflecting a cautious mood among Taiwan's small business community. Last year, only 21 per cent of respondents hired new employees, making Taiwan one of the lowest ranking markets on this measure," Mr Lam says.  

When asked which factors were having the most negative impact on small businesses in Taiwan, respondents ranked increasing costs, poor overall economic environment and increasing competition as the top three.

"With downward pressure on the global economy and increasing staff and rental costs, it is not surprising that Taiwan's small businesses are taking a cautious approach to business, with many focused on maintaining good relationships with existing customers, retaining good staff and controlling costs.

"While these prudent approaches are appropriate, they should also be considering how best to enhance their competitiveness through innovation and increasing the profitability. Competitiveness and profitability can be improved through for example utilising data intelligence software to identify core customers and better understand their behaviour and having a stronger online focus," Mr Lam says.

When asked about digital payment options, such as PayPal, ApplePay and Wechat Pay, only 31 per cent of Taiwan's small businesses received over 10 per cent of their sales through such technology last year and ranked at the bottom of all surveyed markets in the Asia Pacific.

"It is well understood that technology is developing rapidly and it's changing customer behaviour. It is therefore surprising that small businesses in Taiwan are falling behind other markets on this trend. To enhance their competitiveness in this digital era and embrace emerging opportunities, I expect the Taiwan business community and regulators to revisit the current digital payment status and create a friendly and safe online transaction environment for the business sector to boost their domestic and cross-border online sales.   

"Taiwanese small businesses are resilient and flexible. The older generation of small business owners have accumulated extensive experience -- through thick and thin -- to boost Taiwan's economic growth. I believe the second or third-generation, who excel at adapting technologies and generating new ideas, could learn from their predecessors, while at the same time modernising business models to achieve business success," Mr Lam says.

About CPA Australia

CPA Australia is one of the world's largest accounting bodies with more than 164,000 members working in 150 countries and regions around the world, and with more than 25,000 members working in senior leadership positions. It has established a strong membership base of more than 18,000 in the Greater China region.

About CPA Australia Asia-Pacific Small Business Survey

The CPA Australia Asia-Pacific Small Business Survey provides annual insights into the views of small businesses across the region and forms part of a longitudinal study that began in 2009. The 10th CPA Australia annual survey comprised extensive surveying of 3607 small business operators in ten markets, including Hong Kong, Mainland China (Beijing, Guangzhou, Shanghai, Shenzhen and Chongqing), Taiwan, Malaysia, Vietnam, Indonesia, Singapore, the Philippines, Australia and New Zealand.

Market Summary -- Taiwan

Asia-Pacific Small Business Survey

Source: CPA Australia
Related Links: