Seizing Growth Opportunities: What Consumers Want and What Businesses Can Expect in 2026

Despite headwinds from geopolitical uncertainties and shifting trade dynamics, global economic growth is expected to continue, albeit at a slightly slower pace, with real GDP projected at 3.1% in 2026, slightly down from 3.2% the year before. Interestingly, this global expansion is occurring alongside a softening labour market in the US, where job creation has slowed and layoffs have increased due to AI-driven changes, even as productivity remains high.

Across ASEAN, growth is expected to be uneven, as differences in domestic demand, trade and policy conditions shape outcomes across markets. Meanwhile, in Singapore, following a robust 4.8% growth in 2025, the nation’s economy is projected to moderate to around 2.3% in 2026, reflecting a more sustainable pace of expansion.

Similarly, on-the-ground sentiment remains stable: in a recent survey by IndSights Research, business confidence strengthened in Q4 2025 compared to Q3, with expectations of continued improvement in Q1 2026, signalling cautious optimism among business leaders as they look ahead.

While core inflation is expected to remain steady at 1.3%, interest rates have been trending downwards, making financing conditions more supportive for businesses heading into 2026. Together with steady regional demand and resilient performance in key sectors, this points to an economy that continues to offer businesses a firmer base, even as US policy volatility and tariffs, and geopolitical frictions – US-China relations, Russia-Ukraine conflict, Thailand-Cambodia tensions, and US-Venezuela relations – persists.

How are Singaporeans coping with the current economic climate? To better understand these sentiments, IndSights Research conducts a quarterly Business Sentiments Survey with business leaders. Participants will receive IndSights’ Q2 2026 GDP forecast and a complimentary report with aggregated insights to make informed business decisions.

Setting the Right Mindset

Against the current economic backdrop, moving forward with confidence – and seizing growth opportunities – starts with adopting the right mindset. During periods of economic shifts, or as businesses enter a new phase of growth, progress should begin with reframing challenges as opportunities.

In a Business Dialogue conducted by IndSights Research in late 2025, this point was underscored by Mr. Michael Goh, CEO of Innovation Partner for Impact (IPI) Singapore, a subsidiary of Enterprise Singapore. He reminded business leaders that these conditions often tend to serve as catalysts for innovation, as it drives companies to rethink how they operate and compete.

By doing so, businesses can better position themselves to identify gaps in organisational capabilities, reinforce their foundations and develop a roadmap towards sustainable growth. Business leaders should also take this opportunity to re-evaluate existing business models, streamline operations and explore areas for transformation.

On-the-ground Experience from an SME’s Perspective

For many SMEs, their strengths often lie in their ability to move quickly. Being smaller in size, with leaner structures, SMEs can adapt faster and respond more decisively to challenges, enabling them to capture growth opportunities that larger players may be slower to pursue.

This strength was reflected in the experience of Ms. Weijia Zhang, Director of Hi-Beau Group, a leading supplement brand, who shared her experience during the IndSights Research Business Dialogue. Post-COVID, her company faced increasing operational pressures and she had to act decisively to safeguard its future. By leveraging speed and adaptability as competitive advantages, her business was able to move quickly, identify opportunities and stay ahead, while larger players lagged.

Read more: Seizing Opportunities in Turbulent Times: How Singapore Businesses Can Thrive Amid Global Geopolitical and Trade Challenges 

Driving Growth Through Diversification and Product Fit

Diversification formed the core of the strategy Ms. Weijia Zhang pursued, a widely known yet challenging approach that requires thoughtful planning and innovation to be effective. Using this strategy – by breaking down complex products into simpler, separate supplements – her company was not only able to broaden its product offerings, maintain product quality and reduce costs, but diversification also allowed the business to reach a new consumer base. Moreover, she noted that this approach could be applied across industries with complex offerings.

By prioritising a strong product fit when evaluating solutions, she enabled her business to not only survive but seize new growth opportunities, further reinforcing the role product fit plays in building a sustainable, long-term business.

She encapsulated this mindset by sharing the Chinese concept of wei ji (危机), which highlights how in moments of crisis, there is also potential for opportunity – echoing Mr. Michael Goh’s advice. Economic pressure, while challenging, can create favourable conditions for progress by pushing businesses to innovate and rethink how they operate.

However, she stressed that business leaders must recognise that such opportunities often require the willingness to take on short-term risks, as meaningful returns often demand early resource investment.

Changing Consumer Preferences

Economic uncertainty is reshaping how consumers evaluate and engage with businesses. Today’s consumers are increasingly price-sensitive, with spending patterns shifting towards products and services that offer the value they seek at the right price.

In this environment, to seize growth opportunities, business leaders will need to focus on purposeful innovation while maintaining quality and a strong product fit to ensure a sustained consumer base. Growth should be intentional rather than reactive, guided by a clear understanding of evolving consumer preferences.

Contribute to policy outcomes: Participate in our upcoming research studies by registering your interest here.

Business Support Measures by Trade Associations and Chambers (TACs)

Companies are not without support as they move forward. Beyond internal strategies, external enablers, particularly government initiatives and programmes, play a complementary role in helping businesses adapt, innovate and strengthen capabilities.

Many SMEs continue to face cost pressures that strain margins, including rising manpower, rental and operational expenses. Talent constraints further add to these challenges. Businesses are also being pressured to invest in digital tools, workforce upskilling and market expansion to remain competitive, even as customer demand remains uncertain.

Recognising these challenges, trade associations and chambers (TACs) such as the Singapore Chinese Chamber of Commerce & Industry (SCCCI), the Singapore National Employers Federation (SNEF) and the Singapore Business Federation (SBF) have advocated for more targeted support to help businesses manage near-term risks while building long-term resilience. In their proposals for Budget 2026, they emphasised the importance of measures for cost relief, workforce development and digitalisation support, initiatives that directly address today’s challenges and help businesses build the foundation for future growth.

At the same time, businesses remain responsible for managing their own risks and growth, and should actively seek out and tap on the many existing support schemes and grants that can help address their current business needs, and improve their odds of success. Nevertheless, additional support measures introduced in 2026 and beyond will further empower businesses that take the initiative to leverage these resources to compete effectively and cope with, or even thrive in, an increasingly dynamic environment.

More resources: Find out more information on support and schemes by different TACs and organisations on our Resource page

Positioning for Growth in 2026 and Beyond

Growth is increasingly defined by relevance, speed and stability. More importantly, sustainable growth is built on strong core capabilities, coupled with the agility to adapt to evolving customer needs. Businesses that respond quickly to changing consumer preferences through purposeful innovation are better positioned to capture demand, stay ahead, and successfully turn uncertainties into opportunities. At the same time, business leaders should stay updated on geopolitical developments to minimise adverse direct or indirect risks.

By leveraging government and TAC initiatives with clear goals, companies can navigate challenges with greater confidence while investing in capabilities that support future growth. In the year ahead, businesses should take proactive steps to assess gaps, strengthen foundations, and implement strategic innovation, to ensure they stay competitive and seize growth opportunities.

To support Singapore’s businesses community, we would like to invite business leaders to share their views through our quarterly Business Sentiments Survey. Your perspectives will help guide policy decisions that strengthen Singapore’s business ecosystem and support the resilience of local firms.

This article is contributed by Tracy Chow, Research Executive, IndSights Research.