By Felda Chay
[Above: Mr Ho (far left) and Mr Chew believe that most SBF members are convinced that it serves a purpose, compared with when it first started]
SINGAPORE - With a law that guarantees the Singapore Business Federation (SBF) a huge membership base and a steady flow of income, one might think that it is in a sweet spot. But the two current leaders of Singapore's apex business chamber will tell you that its 10-year journey has been anything but easy.
At the beginning, "there were companies that were 'grudging members'", recalls chairman Tony Chew, who has been with the organisation right from the start - having been on the pro-tem committee that oversaw the formation of the SBF, and then a council member after it was formed. He became chairman in 2008.
Some companies were unhappy that they had no say in whether they wanted to be a part of the SBF, as firms with a paid-up capital of more than half a million dollars were made, by law, to join the organisation.
Then there were the membership fees that had to be paid - again, mandated by law.
"It was very challenging in the early days. In fact we had a lot of complaints that came in from a group of members. I don't think that it was a very large group. It was a small group, but they were very vocal and expressed their disenchantment before they even allowed themselves the opportunity to understand, and see what can be done for them as a business committee," says Mr Chew.
"They complained about the fees and they complained about how they do not need such service." Some were, and continue to be, against the principle of mandatory membership, says SBF CEO Ho Meng Kit, who took on his current post last year.
"On my first day of work here, I got a call from the CEO of a start-up company, who said that he, in principle, objects. So I spent half an hour convincing him, talking about the membership and how we can serve him."
Then there is the Singapore Pawnbrokers' Association, which until last year was sending letters to the SBF annually, protesting its membership.
"They say that they really think that they get no benefit. So every year without fail, whenever we bill any one of their members, they will write a letter and say that as an association, they will appeal to us that they object (to the membership)," says Mr Ho.
But the two leaders of the SBF take it in their stride. "I guess you have to work towards taking them on board. We can only do that by demonstrating to them the benefits that they can receive relative to what we are doing for them and their companies," says Mr Chew.
This is perhaps one of the things that keeps the SBF on its toes. Based on surveys it conducts to get a pulse on what its members are concerned about and need, and by keeping its ear to the ground, the grouping, which works closely with trade associations and chambers (TACs), constantly rolls out activities and initiatives to cater to its members.
These include organising overseas business missions, holding seminars and workshops together with partners on risk management to bizSAFE and productivity incentives, and conducting policy briefings such as those on the Singapore Budget.
Last year, the SBF organised over 400 events that had 66,000 participants, a huge leap from the 50 events it held when it first started, which was attended by 10,000 participants.
Its overseas business missions have brought members to destinations as far away as Africa and South America, and places closer to home such as Myanmar - which has been touted as the new business frontier.
Just this year alone, the SBF will be taking members to places such as Sri Lanka and the Democratic People's Republic of Korea.
Earlier in the year, it worked with IE Singapore to take over 100 individuals to Myanmar, and will be heading back to the country again next month due to overwhelming interest from members. It also just led a business delegation with IE Singapore to Turkey - a trip that was made with Deputy Prime Minister Tharman Shanmugaratnam.
Says Mr Ho: "The point is when we mount missions, it benefits the smaller companies more. The large companies have the resources and reach to do it on their own. But it's more the small companies that will benefit when we do something like this."
He says that most of its members look to Asia for growth. "It's quite natural, whether it is China, Malaysia or Indonesia. But further afield of course (there is interest) in the Middle East, particularly in the Gulf states.
"And then also Africa, and Central and Eastern Europe. So a lot of it is emerging markets which are not so accessible and require connections, and the organised mission helps some of these small companies to connect. We have been doing quite a bit of this, and this has gained favour with some of our members," says Mr Ho.
The sharp increase in the number of activities that the SBF organises has raised its expenditure, while membership fees have not grown by much. Today, the SBF collects between $7-8 million from its 18,400 members, just slightly higher than the $5-6 million it received from 15,000 members when it first started in 2002.
"This covers a large portion of our expenses, such as the direct costs of organising events and activities for our members, rental of venues, and staff costs," says Mr Chew. However, it is not enough to cover the $10.5 million or so in costs that the SBF incurs a year.
But there are no plans to increase membership fees. Mr Chew says with a laugh: "Members don't like to pay more if they don't have to. So we have to stretch that part. We are also focusing on fee-based activities to generate income."
These include seminars and workshops, which allow the SBF to earn revenue. Sponsorships also help, and together with the income earned from some of its activities and membership fees, the grouping has managed so far to "keep a surplus for contingencies".
"The MTI (Ministry of Trade and Industry) appoints three board of trustees . . . and their role is to ensure that . . . we maintain prudent financial discipline. So once a year we meet, and they approve the budget and the audited accounts," says Mr Chew.
Apart from increasing the number of activities it organises for members, SBF has also been strengthening its role as the channel for businesses here to provide feedback to the government - one of the key reasons the organisation was formed back in 2002.
At the end of last year, it partnered major TACs here to form the SME Committee (SMEC), which helps to voice concerns of small and medium-sized enterprises (SMEs) here. Some of its Budget recommendations were accepted by the government earlier this year, and it is currently working on recommendations it hopes to make to the government on behalf of SMEs, many of which have said that they find it hard to cope with rising business costs and the economic uncertainty.
Helping members deal with economic restructuring and productivity issues are also at the top of the SBF's agenda, says Mr Ho.
"When we surveyed our members for our latest survey, they said that cost of doing business is very high . . . and they said, why not get the foreign worker levies down? And these are our small companies telling us that (we need to) get foreign worker levies down.
"But if you ask the government if the effects can be reduced, they say no. In fact the quota has been cut, levies have gone up and I think levies will go up in the future. So it's the opposite direction, and now government is saying work on productivity.
"So you see there is a big disconnect between what the authorities want in terms of economic restructuring and productivity, and what the businesses want. So I think there is that huge gap that needs to be bridged."
It hopes to bridge this gap by working together with partners to conduct training programmes that can help to improve productivity.
"We also want to help our companies better access the whole suite of incentives and grant schemes that the government has introduced, and are quite generous with. The sense we have is that while the schemes are generous, some are not so accessible. So we want to make it more accessible to our companies because these are very good schemes that if made more accessible, can be enjoyed by more companies," adds Mr Ho.
Today, both Mr Chew and Mr Ho believe most of the SBF's members are convinced that it serves a purpose. Testament to that is how it now has about 300 non-mandatory members, compared with "hardly any" when it first started.
Further proof comes from the Singapore Pawnbrokers' Association, which Mr Ho says is now "convinced" that the SBF membership is beneficial to them.
"Last year, we decided that this writing of letters should not go on. We went down to engage with the association and said look, we have so many activities, surely there is something, some services, that can help you," says Mr Ho.
"We explained to them that there are many programmes, for example our bizSAFE programme, and the like. And we asked them: Are your members compliant with the workplace safety & health act? If not, we can help you . . . And then they found that some of our programmes and services are things that their members can claw on.
"So they became convinced."
This article was first published in The Business Times.