Overall conditions for Thai small and medium-sized enterprises (SMEs) remain fragile, despite improvement in the first quarter this year.
Thanavath Phonvichai, vice-president for research of the University of the Thai Chamber of Commerce (UTCC), said SME businesses have fared slightly better than the fourth quarter last year, thanks largely to an improving economy.
However, he said most SMEs still posted low profits for the quarter, with relatively tight liquidity.
The latest survey of 1,253 respondents conducted between April 5-20 found SMEs that saw prominent recoveries were tourism-related such as hotels and guesthouses and export-oriented industries such as plastics, auto parts, and logistics services.
Construction and property business also saw strong recovery, driven by the government's myriad infrastructure investment projects.
"The country's overall economy is recovering, but the recovery is still limited, as only SMEs in the supply chain for exports and tourism saw improvement in the first quarter," said Mr Thanavath, adding wholesale business was the most worrisome sector, as domestic operators have been hardest hit by disruptive technology, notably by the online shopping platform, which sells products directly to customers, bypassing brokers and wholesalers.
Mr Thanavath said both small-scale retailers and large-scale operators have embraced online strategies to sell their products directly to end-consumers, leading traditional wholesale operators into more trouble.
"SMEs are still hopeful that their business will improve from the second quarter onwards, as they believe the overall economy will fully recover by the fourth quarter this year," he said.
Suawanee Thairungroj, the UTCC president, said SMEs competitiveness index edged up 0.3 points to 48.2 in the first quarter from 47.9 points in the fourth quarter of 2017.
An index level below 50 points indicates that Thai SMES business situation was not good, with inconsistent sales and purchase orders.
Mongkol Leelatham, president of the Small and Medium Enterprise Development Bank of Thailand (SME Bank), said the bank estimates the number of SMEs totals 4 million, much higher than 3 million estimated by the Office of Small and Medium Enterprises Promotion.
SMEs in Thailand account for 40% of the country's GDP.