Section 5 UEM Edgenta Berhad STRATEGIC BUSINESS 80 SINGAPORE Key Challenges Significant escalation in operating costs driven by inflationary pressures and government regulations that has drastically impacted manpower cost as well as the cost of supplies, consumables and equipment Mitigation Strategies Stringent optimisation of revenue and costs to minimise margin erosion, focusing on optimising non-manpower expenses through bulk purchasing, negotiations with suppliers on the best pricing and efficient inventory management TAIWAN Key Challenges When Hospital Accreditation (“JCT”) commenced in 2023, manpower costs increased tremendously as a consequence of the extra support hospitals needed to attain the accreditation Mitigation Strategies To mitigate the margin compression arising from the double impact of revenue and cost pressures, we are continuously taking up with our clients on a collaborative basis on resolving these challenges Key Challenges Heightened demands and expectations by clients in terms of service levels Mitigation Strategies Engaged in open communication to understand their evolving needs and explore mutually beneficial solutions Key Challenges Operating in a demanding environment where client’s expectations of our services have increased Mitigation Strategies Continue to maintain high service quality and implementation of innovative equipment and systems to excite customers and create service differentiation Key Challenges Increase in minimum wage and concurrent intense escalation in all costs, particularly manpower expenditure Mitigation Strategies Implemented stringent cost reduction, control and avoidance strategies Key Challenges Persistent manpower scarcity aggravated by high staff attrition, foreign worker quota constraints and continuous difficulty in attracting and retaining operatives to work in the housekeeping sector and healthcare environment, especially in the competitive market with growing demand for lower waged workers Mitigation Strategies Strategic collaboration with a wider panel of partners for manpower resources, leveraged various social media recruitment platforms and regular employee engagement and surveys BUSINESS REVIEW
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