Singapore prides itself on its ability to make the most of globalization. This island nation is renowned for intellectual property & business enforcement, reliability, integrity, productivity and quality. However, running a business in Singapore is not without its challenges, and therefore it is very important for startups to have local help.
The International Finance Corporation (IFC) and the World Bank have ranked Singapore at the top of the world for ease of starting and running a business because of the many assets that are essential in the modern business world. Its strategic location and competitive tax rates make it a desirable destination for startups looking to build something overseas and the Asia Pacific region. The state has long been regarded as an economically developed bastion on the edge of an economic boom.
According to TMF Group, Singapore is an efficient and transparent country where every submission is done online which means there are few complications that can disrupt business transactions. The group also notes that startups often consider Singapore for business because of its high standards of corporate governance. They are also interested in the various incentives offered to startups, including tax exemption schemes for young businesses.
However, as previously mentioned, doing business in this archipelagic country has several challenges. For example, the increase in startups reduces margins and provides for tougher competition among businesses, as well as increases operating costs, particularly the stressed labor market and rentals.
Starting a business
Businesses wishing to venture into the country must first register with the Accounting and Corporate Regulatory Authority. Authorities perform name and file searches for business tax (GST) and incorporation numbers. Also must be completed by all startup businesses prior to operating in Singapore including registration of work injury compensation through insurance agents and business stamp.
Dealing with Construction Permits
There are eleven procedures startup businesses have to go through when dealing with construction permits in the country, although the entire process should take less than thirty days to complete. If you wish to start a business here, you must obtain written permission from the Urban Redevelopment Authority before obtaining structural approval of your structural plan.
Employers must also consult with the Central Building Plan Unit of the Ministry of Environment and Water Resources to obtain technical permits. Finally, they must seek approval from the Singapore Commissioner for Workplace Safety and Health and the Land Transport Authority.
Getting Electric
It takes about 35 days to connect to electricity, with most days spent paying connection fees to Singapore Power Services Ltd and opening a power account before SP Ltd does any external work from its grid.
Registering Business Properties
Registering a business property can be a tricky ordeal, especially when it comes to the fees you have to pay. Startups will spend several days searching online for various government agencies, from the Department of Water Reclamation Networks, the Land Transport Authority, the Land Revenue Authority, the Urban Redevelopment Authority and the Ministry of the Environment.
Protecting Investors
The IFC and the World Bank rank the country in second place globally for investor protection power thanks to its outstanding performance on liability, protection indices, disclosures, and claims.
Paying Tax
Singapore law requires Businesses to make 5 tax payments annually which generally takes an average of eighty-two man-hours to complete. Social security contributions, VAT, and corporate income tax are all filed online.
Trading Beyond the Boundaries
Historically, the country has always acted as a center for international trade and is one of the most cost-competitive regions in the world for doing business beyond borders. If you are planning to start an import-export business in Singapore, there are four important documents that you must prepare in advance, and they generally take no more than five days to complete.
Resolving Bankruptcy and Enforcing Contracts
It takes five months to enforce contracts compared to the OECD average of 16 months. Insolvency resolution takes less than 12 months, compared to 33 months in the Pacific and East and 19 months across the Organization for Economic Co-operation and Development (OECD).
Singapore Business Culture
Singapore is a mixed society made up of Malay, Chinese, Eurasian and Indian communities. More often than not, your business associates are Singaporean Chinese because they make up the majority of the state's residents. It is necessary to address Singapore's business culture and this section will offer consideration and advice when dealing with local partners as culture has a major influence on the performance of a startup's business.
Generally, Singaporeans are cosmopolitan and open in their views. In most cases, they will not confront you if you make a social mistake, especially if you are from a different culture than theirs. The general advice is to always be polite and act like a "Roman when in Rome". As a general rule, startups and other businesses should try to avoid discussing issues such as politics, religion, and racial issues. Some of the cultural tips that startup business owners in Singapore should pay attention to are as follows:
Language
Singapore's working language is English while Tamil, Chinese and Malay are the official languages. There is another local language called Singlish, which is basically English peppered with local dialects and slang.
Business Entertainment
Avoid doing business during Ramadan or on Fridays while entertaining your Muslim-majority Malay colleagues. Never serve pork or alcohol. Also, keep in mind that Indians don't eat beef. If you invite a Singaporean colleague to your business social event, you're the one who picks up the bill, then they can reciprocate at the next event.
Powerful Food
It's rare to have a business breakfast in Singapore. The preferred meal for business meetings is lunch. However, long lunches are not common in Singapore, and as such, it's best to avoid planning meetings between 12 and 2 pm. Also, couples are almost never invited to any business dinners.
Punctuality
Singaporeans are usually punctual to their appointments and the same is expected with local and foreign startup businesses in the country. Let them know as early as possible if you can't make it to the meeting on time.
Business Gift
One common way to thank your business associates in Singapore is through a business gift. A small business gift like a pen or notebook with your business logo would be great. Gifts are usually wrapped and presented to the recipient, who then opens it later after leaving.
Gifts with the connotation of cutting or severance pay, such as scissors, are inappropriate as they are seen as symbols of conflict in Singapore. But the letter opener is an exception. For your Chinese counterpart, the number 4 rhymes with death, so it's important not to give any gifts that are in a set of four. For your Malay business associates, avoid giving them alcohol or pork skin products as gifts as this is against Islamic law.
Singapore Business Ethics
There are important differences in doing business in this country and the following provides valuable etiquette considerations for startups in this country.
When making informal meeting introductions and for the first time, always use the individual's title and surname then their personal name, if they have a Chinese name. If they have a western name like "Paul", they should be introduced as in the West, with the name given before the surname.
Malays do not use surnames. They use their personal name followed by bint (daughter) or bin (son) before their father's personal name. Indians use their personal name followed by daughter (d/o) or son (s/o) and their father's personal name.
Business cards should be treated with respect and exchanged at meetings. Ideally, they should take and give with both hands. After receiving a business card from a partner, place it in front of you on the table according to the placement of the people you invite together in the meeting. Never write on business cards, store them carelessly in a folder, or put them carelessly in your back pocket. Any of these actions could be misinterpreted as a lack of respect in Singapore.
There is an increasing emphasis on the equality of men and women. Women do hold strong positions in business as well as in government agencies. Couples of both sexes usually don't go to business events or events unless personally invited.
Despite Singapore's tropical climate, ties and long-sleeved shirts are still the usual business attire for men, while smart business attire is the most ideal for women. You can wear a jacket when attending a formal event.
Singapore Hours
- Shops > 10.00 – 22.00 daily
- Bank> 09.00 – 16.00 Monday to Friday. There are several banks that are also open on Sundays and Saturdays
- Office > 08.30 – 17.30 Monday to Friday.
Funding Options for Singapore Startups
One of the main challenges that startups in Singapore face is access to capital. Many of them are usually financed with informal capital by their founders, or their friends and family members. However, as informal funding sources are not sufficient to support the business, the majority of new people looking to venture into the Singapore and East Asian markets usually seek private equity funding.
Private equity financing is capital sourced from private investors seeking dividend returns and capital gains in return for their investment in your startup business. This type of funding is an attractive source for startups in Singapore, especially those who do not have sufficient collateral to qualify for traditional loans.
To have a better chance of securing equity financing in the country, you need to present a sound business plan, an experienced team of staff to work with you, strong growth potential, a clear exit strategy and sound financial projections. The key to finding the best investors to finance your startup is determining the life cycle of your business. Business angels and venture capitalists are the two main sources of equity capital in Singapore. Other sources of private equity capital include financial institutions, banks, and investment firms.
Singapore ranks among the twelve best countries in the world in terms of the ease of obtaining credit. However, startup businesses should be aware that companies and individuals are not listed on the national credit register with info on their loan history from the last 5 years.
Singapore Business Environment
Singapore continues to be recognized as one of the world's best places for business. A 2013 World Bank report had this to say about doing business in the country “It takes a startup business just over six business days to start in Singapore, due to the low cost of setting up. Overall, taking into account other factors, such as credit law issues, taxes, investor protection and licensing, Singapore has some of the most friendly business regulations in the world.”
Startups also like the high level of reliability and transparency in business, regulatory and economic affairs in Singapore. In addition, the country's literacy rate, and highly connected society plus some of the top globally ranked universities provide a very smooth environment to run any business.
Parliamentary democracy, stable political structure, transparent judicial system, and strong domestic institutions with excellent corporate governance, have made the country's business environment more conducive for local and global startups.
Marketing Startup Business in Singapore
As previously mentioned, startups usually have a limited budget that cannot afford all of their operations. As a result, some often find themselves between a rock and a hard place when trying to market their products or services to potential customers in Singapore.
However, with so many affordable marketing techniques available today, most startups can make the most of them by attracting customers to their products and services. Digital marketing and social media are very effective because they can give your business global reach and lower costs, compared to traditional forms of marketing.
No comments:
Post a Comment