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Southeast Asia Takes the Lead in APAC’s Small Business Growth, FedEx Report Finds

Southeast Asia Takes the Lead in APAC’s Small Business Growth, FedEx Report Finds

Feature Image - Southeast Asia Emerges as Top Growth Market for APAC Region, According to New FedEx Survey

In a recent study conducted by FedEx in partnership with Forbes Insights, Southeast Asia has been identified as the leading growth market for small and medium enterprises (SMEs) in the Asia Pacific region. The survey, which polled 250 small to mid-sized business leaders across various industries, reveals a robust optimism fueled by economic growth and improving trade agreements within the ASEAN bloc.

The findings highlight that 68% of business leaders see significant growth potential in countries like Thailand, Vietnam, and Indonesia. This regional focus is driven by similarities in economic dynamics and cultural affinities, which are seen as advantageous compared to the challenges of doing business with more distant partners in Europe and the Americas.

Despite the promising outlook, the survey notes substantial hurdles. The top barrier cited by half of the respondents is the complex customs and documentation required for cross-border commerce. This challenge is ahead of difficulties such as finding new customers and securing global partners, which were noted by 45% and 42% of respondents, respectively.

Kawal Preet, President of Asia Pacific, Middle East & Africa region at FedEx Express, comments on the findings: “While Southeast Asia shows great promise, the complexities of international trade remain significant. Our role is to simplify these processes, enabling SMEs to focus on their core activities and leverage growth opportunities within the region.”

Moreover, the survey underscores the critical role of digital transformation in overcoming these barriers. While 71% of business leaders acknowledge the challenge in developing a robust digital strategy, advancements in technology, such as analytics, AI, and real-time tracking, are deemed essential for enhancing customer experience and operational efficiency.

The push towards digitalization is not without its challenges. The majority of SMEs allocate only 5% of their annual IT budget towards enhancing digital transaction capabilities. This underinvestment could slow their ability to compete on a global scale despite the increasing reliance on e-commerce, which is expected to grow annually by 9.7% in Asia from 2024 to 2028.

As the APAC region continues to navigate the shifting landscapes of global trade and digital innovation, the FedEx and Forbes Insights report serves as a valuable tool for SMEs planning their growth strategies. By focusing on intra-regional opportunities and leveraging technological advancements, businesses can position themselves for success in the increasingly interconnected global market.

For more detailed insights, the full FedEx research report is available on their website.