7 Essential Steps to Set Up An E-Commerce Business in Singapore

E-commerce is a fast-growing industry in Singapore with numerous advantages for businesses. This business setup cut cost on infrastructure and corporate maintenance.

Nevertheless, setting up a successful e-commerce store does not rely simply on web design. Singapore entrepreneurs have to devise an effective strategy to jump-start their e-commerce journey the right way. Here are seven critical steps to establishing an e-commerce company in Singapore.

#01 — Identifying And Research Your Market

Before commencing any business, business owners should research the market potential of their proposed business idea. They need to identify their target audience and know their competitors. One common mistake many Singapore entrepreneurs make when setting up an e-Commerce business is searching for a product first instead of explicitly targeting a market section.

Conducting primary market research gives entrepreneurs an idea about their target market, how to access it, and evaluate the expected demand for their service or product.

Their initial research should answer the following inquiries to draw a successful business strategy:

• What kind of service or product will they be selling?
• Who will be their prospective buyers?
• Where and how will they get their products?
• What will they do to fund their business?
• Who are their competitors, and what are their competitor’s edge?
• In case their initial business plan fails, what is their plan B?

Look For Funding And Financial Assistance

E-commerce companies have access to various funding and financial aids in Singapore to grow and scale their businesses. The following are examples of funding they can get:

• The traditional business loans: This is probably the easiest way to obtain more money to fund the business. However, this convenience comes with a big risk and cost of losing both the business and capital in case things do not work as planned.
• Investors: Unlike the old-school business loans, this method does not need the principal amount’s repayment in its monetary value. The investors will have a part or share of the business in exchange for their investment.
• Government fundings: Singapore authorities are very ardent in providing help to support their start-ups. They offer many initiatives, including grants, tax incentives, and business incubator schemes to allow start-ups and certain sector businesses to access the funds. E-commerce companies with the right business plan and structure can specifically benefit from the incubators and accelerator programs.

Pick The Right Business Structure

To register an e-commerce business in the country, business owners can pick one of the following business structures:

• Sole proprietorship
• Private limited company
• Limited liability partnership

The best business structure for an online business in Singapore is the private limited companies since they offer limited liability and attractive tax incentives, among several other advantages.

Establish The Business

Generally, the key requirements for incorporating a business in Singapore are as follows:

• Company name
• One or more directors
• One or more resident directors
• Around one to fifty shareholders
• A company secretary
• A minimum paid-up capital of SGD 1
• A registered office address in Singapore
• An auditor, unless the company is exempt from audit

Build The Business Infrastructure

Once the company has been registered successfully, the next step business owners should consider what infrastructure and tools they may need to build their e-commerce business. Here are some key tools they may require:

• A domain name
• A website hosting
• User-friendly website design
• Marketing and advertising plan
• Payment gateways

Set Up a Bookkeeping And Accounting System

Accounting and bookkeeping are mandatory requirements for every incorporated firm. Regular accounting and bookkeeping help the company to stay compliant. They also help business owners get to know the company’s cash flow and financial health.

Since e-commerce businesses are dealing with high-volume transactions, many businesses choose to engage with accounting software to automate the bookkeeping and accounting function.

Ensure The Company Complies With Singapore Tax Regulations

All incorporated companies in Singapore must comply with the reporting standards laid down by the IRAS and ACRA. All companies in the country, be it active or dormant, must perform tax filings. Failure to meet the requirements may cause the company to be charged with fines and penalties, including directors’ debarment.

Getting Help From Singapore Incorporation Services Provider

Professional Singapore incorporation services provider help streamlines the process of company incorporation and ensures it complies with the country’s current rules and regulations. Some company incorporation services also provide other beneficial services, which include tax, accounting, payroll, audit, and business advisory services.