IN today's business environment, small and medium-sized enterprises (SMEs) must bite the bullet and adapt or risk being phased out.

That is the message which the Singapore Chinese Chamber of Commerce and Industry (SCCCI) has been working hard to convey to SMEs, given the unwavering government stance on productivity, restructuring, and manpower, says SCCCI president Thomas Chua.

"Our manpower policies will never U-turn, and the ratio of local to foreign labour will always be there," he says.

Adaption is hence critical, what with the tight labour market becoming a permanent fixture in the local business landscape. Rising manpower costs and rentals are also a "major threat", Mr Chua says. Other challenges that SCCCI members are facing include the uncertain interest rate environment abroad, currency fluctuations, and Singapore's slowing economic growth which will further shrink business opportunities.

Some family businesses are also reluctant to change and adapt due to difficulties in succession planning. The transformation process is a significant investment which could last many years, and if business owners do not have a clear succession plan, they would rather not embark on the restructuring, Mr Chua says. "The result is businesses having to scale down or even close down eventually."

In response, SCCCI signed a memorandum of understanding with PwC in February to collaborate on a study into family businesses, to help business owners understand the family succession process, business transformation, and talent attraction. The chamber counts 4,000 corporates and 152 trade associations as members, and many being family businesses.

"Those who can't adapt will be out of the game because there are always new players coming in," Mr Chua warns. On the other hand, businesses with a fighting spirit that pro-actively take on the challenges of restructuring and raising productivity would definitely receive ample help from the government, he adds.

Through its SME Centre, SCCCI has been conducting outreach activities and helping SMEs identify the ways in which they can adjust to the challenging business climate.

The chamber has also channelled plenty of resources into helping SMEs with their productivity push. So far, it has held seminars and workshops on productivity for 9,500 participants and reached out to more than 300 entrepreneurs through customised overseas productivity camps. The chamber also inked an exclusive partnership with Taiwan's China Productivity Centre to conduct programmes in Mandarin, which many Singapore SME bosses prefer, Mr Chua says.

To cushion the rising costs in Singapore, some businesses are also looking to relocate part of their production activities abroad.

In that aspect, SCCCI is lending a helping hand by organising trade missions to countries such as China, Malaysia, Indonesia, India, and Myanmar. Specifically, many companies are considering building manufacturing plants in Iskandar Malaysia - the chamber has thus held several study trips in the past two years for its members to get a closer look at the region.

For enterprises which have established a presence in Iskandar, as well as those planning to set up shop there, the chamber launched the Iskandar Network @ SCCCI last November to allow SMEs in Singapore and Iskandar to share their views and exchange information. The Iskandar Network will foster relationships, generate business opportunities, and bring the businesses together to resolve challenges relating to Iskandar.

"If necessary, we can also duplicate this network to other areas such as Batam," Mr Chua says.

This year, as one of the initiatives under the Iskandar Network, SCCCI is planning to visit its counterpart in Johor Bahru, the Johor Bahru Chinese Chamber of Commerce, to build stronger ties.

One of the chamber's tasks for the near future lies in working more closely with the government to understand the policymakers' thinking and views, especially in terms of economic development. At the same time, however, it is also important for the government to understand the ground situation well, to avoid hiccups in their policies, Mr Chua says.

That is why SCCCI has been providing the government with feedback from the ground, following its regular surveys on SMEs and monthly dialogues with trade associations. This is also where Mr Chua's role as a Nominated Member of Parliament tends to come in handy.

To better serve its role as a bridge between the business community and the government, SCCCI is also looking to boost its research capabilities so it can be more forward-looking and sensitive to economic trends.

"It's only with sound research data and analysis that we can advise our members on the implications of the trends, and give timely responses to government policy," Mr Chua says. The chamber's recent recommendations have been taken up by the government - some are reflected in the extension of the PIC to 2018, the provision of affordable industry space to SMEs, and the development of the Trade Association Hub (TA Hub).

In particular, TA Hub will be an impending big move for the chamber. The hub, set up by JTC, will open by early 2017 and allow trade associations and chambers to share facilities, which will reduce rentals and operating costs, and facilitate greater interaction and business tie-ups.

SCCCI will be the hub's first anchor tenant. It plans to relocate part of its secretariat and part of its Institute of Business (IOB) training facilities there. The relocation will also see SCCCI IOB offering more training courses.

For the smaller trade associations which lack manpower to run their operations effectively, SCCCI plans to support them by providing pooled secretariat services at the hub.

Progress on TA Hub has been very promising, says Mr Chua. Currently, the focus lies in fleshing out the details of critical issues such as rental and space planning.

Close to 10 trade associations have decided to join SCCCI at the hub, and the chamber plans to sign an agreement with them in early June.

Going forward, succession planning looms as a major challenge for the 109-year-old chamber, as it tries to encourage young entrepreneurs to come forward and serve as members or as part of the council.

"In the past, because of the presence of successful Chinese businessmen in the council, people had the impression SCCCI was a 'rich old men's club'," Mr Chua says. It is now pumping substantial resources into revitalising its image, for example by holding more bilingual events such as the upcoming Infocomm Commerce Conference in August, to change public perception of itself as a solely Chinese-speaking organisation.

To engage younger business executives, the chamber has also been drumming up its online and social media presence.

In the hopes of inspiring the younger generation, the chamber also initiated the inaugural Outstanding Chinese Business Pioneers Awards earlier this year. The awards recognised the contributions and stories of successful Chinese pioneers, and were meant to instil the Chinese entrepreneurial spirit in potential SCCCI successors.