Setting up an E-commerce company in Singapore
5 minute read
Due to the increasing cost of infrastructure and corporate maintenance many business owners are turning to the world of online commerce. The benefits of the digital world require some planning and like any business an investment of time and money.
Below we have outlined some of the steps to successfully start your own online business:
Step 1: Research and Planning
Conducting initial market research is an essential first step to give you an idea about your target market, how to access them and to assess the expected demand for your product or service?
Your initial research should typically answer questions such as:
Step 2: Funding & Financial Assistance
Financing programmes, tax incentives, cash grants, venture capital and business-incubating infrastructure – everything that a startup needs, Singapore is sure to have it.
In fact, e-commerce businesses have access to a variety of different funding and financial instruments to help grow their businesses.
For more details on funding for your business refer to our other short resources:
Step 3: Choosing the right Business Structure for Singapore Business
E-commerce entrepreneurs can condisder using one of the following business structures:
*Available only to Singapore citizens, permanent residents or Entrepass holders.
Private limited companies offer the best choice to run an online business ideas in Singapore. A Pte Ltd limits your liability to the amount you have invested in its shares, provides access to attractive tax incentives among many other benefits.
An overseas company looking to set up in Singapore can use one of the following business entities to register a local presence in Singapore:
Step 4: Incorporate your business
Here are some key facts on opening a company and doing business in Singapore and what you need to Incorporate your business:
Few other helpful things to keep in mind when registering a company:
Required documents at incorporation:
For complete step-by-step guide on setting up a company, find our ultimate guide on how to register a company in Singapore.
Step 5: e-Commerce Infrastructure
Once your company is successfully registered, the next step is to consider what tools and infrastructure you may need to build your e-commerce business.
Step 6: Bookkeeping and Accounting.
Bookkeeping and accounting is a mandatory requirement of any incorporated company.
From day one, all directors should seek to put in place a good system for easily tracking and accounting for all business transactions. Aside from the obvious benefits of knowing your financial position and cash flow, keeping track of a company’s accounts is important for securing future business loans and investment.
Due to the high volume transactions many e-commerce businesses choose to leverage accounting software to help automate much of the accounting and bookkeeping requirements for their businesses.
Accounting and inventory management software like Xero and A2X (for Shopify & Amazon sellers) can help to easily keep track and reconcile sales invoices, expenses and bank transactions. The good news is that today many of these solutions integrate together and even to the different banks in Singapore to make your life even easier!
Step 7: Tax compliance.
All Singaporean incorporated companies must adhere to the reporting standards set by the Inland Revenue Authority of Singapore (IRAS) and the Company Regulator ACRA.
Whether your Singapore company is active or dormant, all tax filings are compulsory. Failure to meet these deadlines can lead to fines and penalties including debarment of directors.
Reporting deadlines are triggered by the companies End of Financial Year. An example can be seen below and more detail can be found in our 3 minute guide to Singapore Company Tax Filings.
Incorporating in Singapore is a strong choice when deciding where to base yourself. A stable economy, strong global reputation, and business-friendly tax policies let you get up and running sooner – so you can spend less time tangled in admin and more time growing your business.
At Sleek we help people everyday to set up their businesses in Singapore. Talk to us for practical advice if you have any questions about incorporation.