Lifting productivity in Singapore’s retail, F&B

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The last couple of years has seen increased focus among government & policymakers to ramp up Singapore’s indigenous productive capabilities, especially those of its small and
medium businesses (SMEs).

In a report released in 2010, the Economic Strategies Committee (ESC) – a government
committee set up to provide strategic direction for the economy’s growth in the coming decade – identified SMEs as a key driver of productivity-driven growth. However, measuring
productivity is often considered a difficult task for industries in the service sectors. While the
ESC report set a target of doubling the number of local SMEs with revenues of over S$100
million to 1,000 in 10 years, attainment of the target has still quite some way to go.

The Singapore Productivity Centre (SGPC), a one-stop competency centre established under
the auspices of the National Productivity Council, carries out applied research studies to find
out about the critical issues facing SMEs in the retail and F&B sectors that lead to a
slowdown in growth.

The latest volume of their research studies is titled Lifting Productivity in Singapore Retail
and Food Services Sectors: The role of technology, manpower and marketing comprises
topics in self-service technologies, cash management technology, RFID, 3D printing,
centralised kitchen and dishwashing, part-time manpower pool, job redesign, M-commerce
and use of loyalty cards.

What the studies indicate is that a good framework is necessary for an effective analysis of
problems faced in business operations and productivity improvement. The central message to companies is that the pursuit of productivity based on a single index (such as value-added per worker) can be fraught with difficulties and apparent contradictions regarding measures to be taken.

Some of the SMEs have also made themselves the role model in terms of implementation of
new technologies and are showing the path to other SMEs, who may feel more confident
after reading the success stories of other enterprises. Furthermore, customers are also
increasingly willing to accept productivity-enhancing tools. Customers have certainly
instilled more trust in online systems and payments in recent years, giving retailers a better
opportunity to reach out to customers.

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