There is no global standard definition of an SME. Some indexes are used to define SMEs by way of number  of employees (most common), production capacity, fixed assets, shareholders funds, and sales volume. In China, medium enterprises employ between 101 to 500 employees. In Singapore, SMEs providing services employ less than 200 employees. In USA, manufacturing SMEs employ less than 500 employees.

A University of Wollongong study reported that SMEs play a larger structural role in Taiwan, China, Japan, Thailand and Vietnam where they contribute over 70 percent of employment, than they do in Indonesia or Malaysia where they contribute only around 40 percent. In addition, the contribution of the SME sector to exports, and hence the extent of their global integration, also varies widely. They are relatively more export oriented in China, Korea and Taiwan than they are in Japan, Indonesia, Thailand, Malaysia and Singapore.

On 8 March 2007, APEC Ministers and their representatives responsible for 21 economies met in Hobart on 8-9 March 2007 for the 14th APEC SME Ministerial Meeting. Ministers agreed that SME growth would be stimulated by (a) reducing transaction costs and red tape imposed by governments, such as making it easier to start and grow a business; (b) encouraging innovation; (c) saving time for SMEs, for example encouraging the use of e-commerce and online transactions with government; (d) better understanding and management of intellectual property rights; and (e) encouraging SMEs to consider internationalisation.

In this article, we focus on internationalisation and try to understand a typical Asian SME boss’s mind. I interviewed Ms Elim Chew, Managing Director of Singapore’s 77^th Street, a street wear retail fashion chain serving the hip and trendy youth culture segment with street wear fashion. Some of Elim's achievements include being named the “Most Promising Woman Entrepreneur” by The Association of Small and Medium Enterprises (ASME) in 2001; winning the “Mont Blanc Businesswomen Award” in 2002; and most recently, being awarded the “Young Woman Achiever Award” by Her World. She was also awarded the “Leadership and Mentoring Award” by Research Communications International. This award was also supported by The Association of Small and Medium Enterprises (ASME). Under the guidance of Elim, 77th Street became the first fashion retailer to win the prestigious “Singapore Promising Brand Award”, "Most Distinctive Brand” 2004 conferred by ASME and Lianhe Zaobao.

LY: What is driving your Asia investment and expansion? How important is Asia to you?  

Elim: Asia is a fast growing economic powerhouse especially in China and India. Most other Asians countries are also enjoying surging economies and thus it made sense to tap into the Asian Markets. As of now, we have a shopping mall in Beijing called 77th Street Plaza all poised for the Beijing Olympics next year. We plan to duplicate this concept in other parts of China and India and also to appoint franchisees in Asian countries.

LY: What are your company’s strategic intent when investing overseas?  

Elim: The intent is to spread our retail outlets and malls with the concept of youthful vibrancy. We will certainly welcome co-opetition and strategic alliances with anyone who have synergy with our vision.

LY: How would you explain your company's general approach to Asia investment? How is your Asia investment experience?

Elim: the planning of investment will be largely focused on the return of investment. Our Asia experience was a steep learning curve initially. However I am happy to say that the learning curve is almost over. That is not to say that there are nothing else to learn. Things are dynamic and in a constant flux.

LY: What is attractive and unattractive about doing business in Asia?

Elim: Attractiveness is that the market is huge the potential is astronomical. Cost of doing business is also low in many countries although they are rising rapidly in the faster developing cities.  The downside, learning curve is also huge and in some countries, the rule of law is blurred and this can make business decisions guess work.

LY: Tell us more about what you know and feel about the Asian culture.

Elim: There is no single Asian culture. They are complicated and differ from place to place.

LY: People factor: how do you train, condition and equip your people before sending them outwards to new Asia locations?

Elim: We rarely send Singaporeans to other locations as the thinking is that the locals know their own market and psyche better.

LY: What other advice, warnings and tips would you share to your global readers about investing and doing business in Asia?

Elim: The usual which you learn in business schools. Plan, plan and plan and then execute the plan. Then tweak it until it becomes a success formula.