The programme is dubbed the SME Suppliers Support and Development Programme (SSDP), and was established for FairPrice to provide systematic assistance to local SME partners via both commercial and promotion-based initiatives.
“Since its inception, in total FairPrice has spent S$7 million to provide support to about 400 SMEs,” FairPrice Group Chief Procurement Officer Tng Ah Yiam told FoodNavigator-Asia.
“An estimated S$1mn (US$735,000) has been spent on this initiative annually since the programme was re-introduced in 2012.”
SSDP was first introduced in 2009, with the objective of helping local SMEs overcome restructuring challenges and tide through the global financial crisis. The programme was re-introduced in 2012 during the economic slowdown.
“We recognise the challenges SMEs face amidst structural disruptions in the retail landscape, changing customer preferences and increasing competition. SSDP enables FairPrice to help our local SME partners boost their business growth through various assistance types,” added Tng.
“These include: Reducing business costs and widening business growth opportunities, e.g. with 50% discounts on processing and 30% on new product listing fees; easing cash flow pressures for suppliers or accelerating payments to them with regard to payment terms; supporting sales growth by promoting locally-made products through FairPrice store promotions and product fairs, and more.”
Other initiatives include supporting company development by affording these SMEs special consideration to be packed as FairPrice house-brand products, and providing education and industry insights via knowledge-sharing seminars.
“As SMEs benefit through the aid in pushing out new products, they are better equipped with skills and financial resources to expand their businesses both locally and abroad,” he added.
“In addition, SSDP also aids in freeing space for SMEs to innovate and invest in technologies that aid in their restructuring processes and in equipping leaders in the company with knowledge and skills to manage such challenges.”
Successful SSDP SMEs
Some of the better-known local brands that have flourished under support from SSDP include Koka Instant Noodles by Tat Hui Foods, now-regional desserts and seasonings firm Sing Long, Golden Bridge sausages and canned meats, as well as Seah’s Spices seasoning packs.
Responding to queries on major success stories yielded by the SSDP, Tng cited Golden Bridge as a case study.
“Golden Bridge has benefited from the discount on listing and processing fees for new products, where with these discounts, the company was able to launch even more new products, leading to an increase of 10% in sales revenue,” he said.
“One of the most beneficial aspects of SSDP would be the shortened payment terms of 60 days to 30 days for suppliers which significantly ease cash flow pressures such as rising operating costs from labour, rental and utilities.”
