LOCAL CONTRACTOR BUSINESS FAILING DUE TO PRC COMPETITORS

Editor’s Note: This letter was sent by a reader working in the construction industry. The views in this letter are his own.

hi editor,

i am a SME business owner for over a decade in Singapore. my business is in construction, so i handle many projects for private developers who want my company to build small scale condos and industrial estates.

things were very difficult for my company in the early part of 2000. many construction companies bankrupted because they did not have any business, esp the slowdown of projects because of bad economy in Singapore and the world.

but my company pulled through because of the help of some good developers who handed me small side projects which they could not handle themselves, due to too many project or because of good will.

things are changing. now many of the developers who helped my sme in the past are giving projects to cheap china contractors. a lot of these company set up shop here in the past few years only.

what they do is offer cheap discount prices when they bid for projects, many of which are unrealistic. their prices are low not only because they have access to cheap suppliers in china, but because they underbid and tou kong jian liao (ed. trans: cut corners to save costs). this is not a joke. if you go to a condo and wondering why so many problems or defects in the worksmanship in these china company projects, you will agree with me.

because of that, my company is left with only 1 project, which will be completing in three months time. after that, i will have no projects and i don’t know how to tell my workers that they will be laid off and have to find another company. many of these workers and colleagues have been with me for years and i am reluctant to let them go.

there is no choice. i can only tell them that its because our business has been undercut by china and we will all have to find other ways to earn money for our families.

Benny Tan

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