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The number of distressed small and medium-sized companies (SMEs) is increasing as Singapore's economy restructures, according to an article published on 14 June 2017, written by Dr Michael Teng, Asst. Secretary General of Singapore Manufacturing Federation.
Dr Teng stated in the article: “They (distressed SMEs) are in a state of poor health, and, as is well known, if you are seriously sick, you cannot cure yourself through self-medication. You need help from the outside in terms of funding, operational turnaround or assistance in finding a "white knight" to ride in and rescue the company. If left to market forces during difficult times, even healthy companies are adversely affected. The marine and offshore engineering sector, where once strong companies such as Swiber, Swissco and Ezra can collapse, is a case in point” .
In other words, what these SMEs need is a corporate turnaround to quickly help the company restore corporate value and avoid the possibility of liquidation.
One way of helping companies in such situations, Dr Teng highlighted, is for industry, trade associations and the Government to work in a concerted fashion to create dedicated "rescue centres" that would assist in devising plans to turn around their fortunes, and also put such plans into execution;
To help distressed SMEs who are facing challenges of keen competition, high labour cost, lack of demand, shortage of staff and shrinking market share, SMF is actively collaborating with government agencies for a series of funded Masterclasses on Corporate Turnaround related topics to be conducted: