How to start a successful small business in Singapore
From fundraising to marketing your products and services, here are some top tips to keep in mind when setting up a new business in Singapore.
The thought of striking out on your own can be enticing – but is it a wise move to set up a new business in the current environment?
You may be surprised to learn that past economic downturns have proven to be a great breeding ground for successful start-ups; Airbnb and Gojek are just two of many examples of businesses launched in the late 2000s. While there isn’t a specific formula for guaranteed success, it often pays to have the right mindset, sufficient starting capital, and a bank account with a supportive banking partner to ease the process.
Here are three tips to start a resilient and successful business in Singapore, built with growth in mind from the very beginning.
1. Create a detailed business plan
Every business vision must be underpinned by a robust and sustainable plan, as this can mean the difference between success and failure. Think of a business plan as a detailed guide for starting your new business.
There are a few essential pieces of information every plan should include, such as business objectives, financial goals and marketing strategies. It is also prudent to include market research information regarding your industry and competitors in your business plan. By conducting a competitive analysis of the industry landscape, you’ll be able to fine-tune your own products or services to differentiate your offering and stand out to attract customers.
But how do you research your competitors?
There are a few straightforward steps to a competitive analysis. First, identify who your competitors are through the services and products they offer. Next, monitor their strategies and evaluate how successful they are. This can be done using a simple SWOT analysis to learn their strengths, weaknesses, opportunities, and threats.
Once you have a clearer picture of your competitors’ unique selling points and marketing plans, you can modify your methods to fill the gaps and strengthen your own value proposition and marketing efforts.
2. Estimate your start-up costs and secure funding
The cost of starting a business can vary greatly depending on many factors, including whether you want a physical space, or need to hire staff, buy inventory, or undertake any R&D. Several practical tools are available to help estimate the total business costs you may incur; one of these is the set-up cost calculator from the Singapore Economic Development Board. Business of all sizes can use this tool to estimate the funds needed in their first year of operations.
With this cost estimate on hand, you can begin raising capital to get your business off the ground.
There are several ways to obtain funding for your business. Some common fundraising methods include crowdfunding through online platforms, applying for government grants, seeking angel investors and securing bank loans. You can also opt for investment vehicles to grow your money, allowing your capital to increase over time. If you prefer not to shoulder the burden yourself, find the right business partner to contribute to your business so your load is lessened.
A business loan can be a powerful funding option for SMEs. A loan can help with managing your cash flow for operational expenses such as paying employee salaries or renting office space. It also helps build a credit profile, allowing you to capitalise on future business growth opportunities.
Taking a business loan can also be cheaper than equity financing, which requires you to give up a percentage of your business. In addition, your bank may offer a flexible repayment plan that aligns with your business’s cash flow requirements. For example, DBS SME Banking offers a business loan that can be used for both working capital needs and business growth opportunities with a flexible repayment period of one to five years.
3. Open an online business bank account
Even if you are the sole owner and the only employee of your business, it’s advisable to have a separate business bank account. This makes tax filing, accounting, and cash flow management much easier. Further, with the rise of digital banking in our highly interconnected world, an online business bank account may be the most suitable option, particularly if you intend to expand your business quickly.
There are many business bank accounts and services available in Singapore, including the DBS Business Multi-Currency Account (BMCA). The DBS BMCA is an ideal account for start-ups that intend to scale -you may be based in Singapore but may need to source overseas and pay vendors and suppliers in other currencies; or may have plans to break into other markets in a few years. With the DBS BMCA Starter Bundle, you can hold your Singapore dollar and 12 other currencies through one account, leverage on competitive foreign exchange rates, enjoy flat OTT rates and unlimited free FAST and GIRO transactions - with no minimum balance.
Let DBS digibanking solutions help you start your business the right way
Developing a solid framework and setting a good foundation can give your entrepreneurial journey a strong start, and help you build a sustainable and successful business.
Setting up your own business is both a rewarding and empowering experience, especially when you have the right advice and access to the right tools and services from the beginning. With DBS digibanking solutions, you’ll gain access to a range of business banking services to help you start, run and scale your business more easily. Visit www.dbs.com.sg/sme/digibanking to learn more or reach out to ChatBoy Joy for further information.