A research by FedEx Express, a subsidiary of FedEx Corp. (NYSE: FDX) and the world’s largest express transportation company, reveals that most Malaysian SMEs who export focus on markets beyond the Asia Pacific (APAC) region. Notably, 82% of these Malaysian SMEs now export to markets beyond APAC, which by far exceeds the 55% exporting within APAC.
The “Global is the New Local: The Changing International Trade Patterns of Small Businesses in Asia Pacific” research shows that exports make up 71% of the revenues earned by APAC SMEs who export, a 60% increase from 2016. Exports from APAC SMEs to outside APAC exceeded exports to markets within the region. 71% of APAC SMEs who export now export globally beyond APAC while 70% export within the region.
“It is exciting to see local SMEs expanding their businesses and generating more revenues from exports. FedEx believes that a connected world creates significant possibilities for cross border-trade which helps businesses to grow in an increasingly globalized market,” said S.C. Chong, managing director, FedEx Express, Malaysia.
Welcoming the findings, Dato’ Ng Wan Peng, COO, Malaysia Digital Economy Corporation (MDEC) commented: “In today’s hyper-connected global market where businesses can take the leap to expand their businesses digitally, MDEC will continue to support SMEs through various strategic platforms and training to facilitate development of technical skills to help them to propel forward.”
Exports account for 77% of the total revenues of APAC SMEs, with Malaysia among the top four markets in export revenue earning RM4.75 million annually, alongside Singapore (RM7.18 million), Hong Kong (RM5.93 million), and the Philippines (RM5.79 million).
In APAC, China and Thailand are the top export markets for local SMEs with 29% of SMEs exporting to the two countries. Outside APAC, top export markets are India (48%) and Bangladesh (20%).
57% of Malaysian SMEs source goods and services locally while 43% import them from other markets. However, 37% of local SMEs predict an increase in imports in the near future citing higher quality products, lower production cost, greater product variety, higher customer satisfaction and increased sales.
This independent study conducted by Harris Interactive on behalf of FedEx Express was based on interviews with 4,543 senior executives of SMEs conducted online or by telephone in nine markets (Mainland China, Hong Kong, Japan, Malaysia, Philippines, Singapore, South Korea, Taiwan and Vietnam) between March and April 2018. The sample size was approximately 500 respondents per market.