How to Start a Small or Medium-Sized Business in Singapore?

Small and Medium-sized Enterprises (SMEs) are an important part of Singapore's economy. In fact, they make up 99% of the nation's companies, employ 70% of the total workforce and contribute 50% to the GDP.

In recent times, these enterprises have shot into the limelight because of Singapore's collective focus on economic restructuring and raising productivity, leading to many SMEs facing challenges in manpower, land and energy.

But, as every cloud has a silver lining, the hard times for Singapore SMEs give a not-too-often-available opportunity for aspiring entrepreneurs to take the plunge and start their own businesses.

The advantage is that while established SMEs, which have traditionally relied heavily on foreign manpower and are thus struggling as the government has tightened the workforce inflow, the newly incorporated business entities can start afresh.

They can put in place highly efficient processes operating at full productivity in their initial set-up, eliminating or at least minimizing their need for foreign manpower. They can also benefit from the many schemes that the Singapore Government has introduced especially targeting the SME sector.

Below is a guide on what all you need to know before setting up an SME in Singapore, and what you need to know once you have decided how to set-up one.

Considerations before Starting a Small or Medium-sized Business in Singapore Demarcate a budget and prepare a blue-print

Ideally, a three-year business plan with available capital and potential costs (covering the rents, salaries, inventory management, merchandising, marketing, advertising and a buffer for any unforeseen expenses) must be in place before starting the business.

Use all your creativity to gather finances

Firstly, put some of your money in the business. When investors see your confidence, they will be more willing to put their money behind you. Remember no one will back you unless you can vouch for yourself first!

While bank loans may be tough to get, opt for venture capitalists or use platforms such as crowd-funding. These are ideal for small businesses, especially those with some societal undertone or a paradigm-shifting idea.

Prepare to use online marketing strategy

As it’s an internet age and Singapore is a highly connected society, register your domain address on the web and use search engine optimization so as to maximize the traction on your website. It will give you potential business. Here, you have to take a call whether to choose a.sg,.com or any other domain extension, depending on the market you’re targeting. Remember to choose the extension, keeping in mind your business expansion plans and the long-term vision.

When the website is up and running, use all the available social media tools to maximise your reach. Don't underestimate the power of word-of-mouth marketing strategy.

Physical location does matter

While an online presence has its advantages, it still can't replace the real thing. So, if you are opting for a retail business (or any other type with potential walk-in customers), it's all about location, location, location. The idea is to identify your buyers and target audience, which will help in locating the best site for your enterprise.

Put a qualified support team in place

This is important as an attorney, accountant, incorporation specialist, or financial adviser will likely see potential challenges to the business before you do. They also advise you on the several statutory compliance requirements, permits and licenses required to do business in Singapore.

Read more about on startup guide for Small or Medium-sized Enterprises at Rikvin.com.