• Singapore is one of the most business-friendly countries, offering incentives for entrepreneurs to start their businesses.
• Business structures, such as sole proprietorship or partnership, must be chosen depending on the company’s needs.
• Various sources of financing can be accessed, from personal loans to government grants and venture capitalists.
• Careful consideration must go into choosing a company name, as specific regulations must be adhered to.
• Applying for the appropriate licenses and permits required by law is also necessary before commencing operations.
Singapore is one of the most business-friendly countries in the world, offering plenty of incentives and programs to help entrepreneurs get their businesses off the ground. The country’s fiscal stability and low taxes make it an attractive location for businesses seeking to expand into new markets. However, before you can start doing business in Singapore, there are certain steps you must take to ensure compliance with local regulations. Here’s a look at them.
Business Structures
The first step when setting up your business is deciding on the right structure. Each structure has its advantages and disadvantages, so you have to choose depending on your needs. Here are some examples:
Sole Proprietorship
This is the simplest form of business, and it’s suitable for small businesses. The owner has complete control over the company, but they are also personally liable for any debts or obligations incurred by the business.
Partnership
A partnership is a business structure where two or more individuals share ownership of the company and share profits, losses, and liabilities. There are different types of partnerships available depending on the number of partners involved, but all parties have to agree on decisions made by any one partner.
Limited Liability Company (LLC)
An LLC is a separate legal entity from its owners, meaning that the company can enter into contracts and incur debts independent of the partners. All profits and losses are shared amongst the members in accordance with their ownership stakes. This structure offers more protection to owners than other types of businesses.
Financing Your Venture
After choosing your business structure, you will then need to secure funding. There are both traditional sources and venture capitalists in the country, so it can be tough to choose. Here are some common options:
Personal Loans
Acquiring a personal loan in Singapore can be a great way to get the money you need to start your business. These are usually unsecured loans, meaning there’s no collateral attached to them. However, you may have to pay a higher interest rate as the lender assumes more risk.
Government Grants
The Singaporean government offers grants and other financial assistance for entrepreneurs looking to start businesses in specific sectors or industries. These can be excellent sources of funds if you fulfill the criteria, so it’s worth researching to see if you qualify.
Venture Capitalists
Venture capitalists are investors who provide funding for businesses in exchange for a stake in the company. This is a great option if you can find an investor who believes in your idea and has the money to invest. However, they may also have their own ideas on how the company should be run, so this can be a tricky option to negotiate.
Choosing a Company Name
Once you’ve decided on the type of structure and financing option you want for your business, you can move on to choosing a company name. This should be done carefully because it cannot be changed easily or cheaply once registered.
Your chosen name must not be similar to any existing company names registered with ACRA (Accounting and Corporate Regulatory Authority) or contradict existing company laws. It must also contain an appropriate suffix such as ‘Pte Ltd’ (private limited).
If your chosen name meets these criteria, you can register it with ACRA. Afterward, you can register your business with relevant government agencies, obtain a business license, and start operating.
Applying for Licenses & Permits
In order to operate legally in Singapore, businesses will need to apply for the appropriate licenses and permits required by law. Many types of licenses are available depending on your business’s nature.
Common examples include food licenses, liquor licenses, and construction permits. Each has its own requirements and fees, so it’s essential to research what licenses you need before applying.
Furthermore, your business may also require its own ‘Employment Pass‘ to hire foreign staff. This pass is issued by the Ministry of Manpower and needs a certain amount of money in order to be approved.
Starting a business in Singapore is an exciting opportunity that comes with plenty of potential rewards. However, there are also numerous regulatory hurdles that need to be crossed first before getting started. It’s important to take time researching which type of structure best suits your needs and familiarizing yourself with all relevant licenses and permits required by law before taking any other steps towards setting up shop there. Once completed, you’ll have everything you need to get started.
