Many small businesses remain weak

09:29 | 13/06/2015 Trade

(VEN) - The results of a quick business survey recently conducted by the Vietnam Chamber of Commerce and Industry (VCCI) revealed that while some businesses planned to expand their operations in the last three quarters of this year, most companies intended to maintain their operations at their current level or would downsize due to a lack of capital and skilled workers.

Many small businesses remain weak

Small and very small enterprises are yet to think of expanding their operations due to high business costs

According to Doan Thi Quyen from the VCCI’s Business Development Institute, most survey respondents saw better conditions for production and business activities in the second half of 2014. Specifically, they saw improvements in the quality of regulations, the enforcement of policies, administrative procedures related to businesses, the behavior and responsibility of state authorities, and the stability of the legal environment and economic management policies.

The production and business results in the first four months of this year were worse compared with the last six months of 2014. There were little improvements in some factors such as profit per unit of output, average ask prices, and the number of orders. Most companies did not fulfill their business plans in the first four months, especially very small enterprises. Businesses in the fields of industry and construction achieved better results compared with those in the fields of agriculture, forestry, fisheries, trade, and services.

In the first four months of 2015, small and very small enterprises met more difficulties than medium and large businesses. The revenues and number of orders received by small and very small enterprises decreased while these indexes of medium and large businesses increased. Notably, the profits of small and very small enterprises showed a sharp decline. Small and very small enterprises tended to cut their workforce while medium and large businesses recruited new employees.

Survey results showed that in the first four months of 2015, about 2.3 percent of respondents said they had to temporarily stop their operations for one or two months (in 2014, this was 2.2 percent), of which small and very small enterprises accounted for 76.5 percent and large businesses 23.5 percent. Foreseeing good export opportunities, 42.2 percent of respondents had plans to expand their operations in the last three quarters of this year, while 56.1 percent intended to maintain their operations at the current size; 1.7 percent planned to curtail operations; and 0.1 percent expected they would possibly have to temporarily stop operations.

VCCI Secretary General Dr. Pham Thi Thu Hang said businesses needed to be more active in seeking new markets for their products and persify export markets to prevent their dependence on just one market. Furthermore, businesses should take the initiative in seeking access to new technologies and have strategies to expand operations. At the same time, they should set up effective distribution channels to deal with inventories./.

By Thuy Ngoc

 

 

Theo ven.vn