5 Things International Firms Need to Know About Doing Business in Singapore
by Arina Smith Business Planning & Opportunities 20 November 2018
Singapore is widely known as a great place for foreign companies to do business.
According to the International Trade Administration, a division of the United States government, Singapore’s gross domestic product grew 3.6% in 2017, the most recent year for which figures are available — a remarkable rate for a mature Asia-Pacific economy.
Moreover, despite its diminutive population, Singapore is the United States’ 13th largest export market. Indeed, more than 99% of goods imported into Singapore are free from duties.
In short, the business case for Singapore is quite strong.
The upshot of Singapore’s world-renowned advantages is the competitiveness of its market. You would be hard-pressed to find a foreign company without designs on Singapore — a real challenge given the island city-state’s limited market size.
With all this in mind, let’s take a closer look at five things every international firm should know about doing business in Singapore before entering the market.
1. Singapore Has Strong IP Protections, But Local Support Is Nevertheless Essential:
According to the Intellectual Property Office of Singapore, strong IP protection is the norm here. However, it is nevertheless essential for foreign firms to partner with local law professionals specializing in IP issues — particularly if they plan to do business with third parties based outside of Singapore.
2. A Local Corporate Services Partner Is Essential, Too:
Despite its business-friendly regulatory regime, Singapore presents many unique challenges for foreign firms entering the market for the first time. Close coordination with local trust and corporate service providers like Asiaciti Trust ensures rapid acclimation.
3. After-Sales Support Is Key:
Singapore-based clients expect robust after-sales support of the sort you may be used to providing clients in other mature markets. Don’t neglect this aspect of your business; retain local support if resource constraints demand it.
4. Corruption Is Virtually Nonexistent:
This is an unalloyed good, of course, but it may nevertheless come as a shock to firms used to doing business elsewhere in the world. Expecting any sort of favoritism from government officials is sure to result in disappointment, and taking ethically or legally questionable steps to engender it may well have serious consequences.
5. Business Meal and Entertaining Etiquette May Be Unfamiliar:
The differences are not radical, but it is unfortunately quite common for foreign businesspeople to commit preventable faux pas on arrival in Singapore. For instance, business breakfasts — increasingly plentiful in the U.S. and U.K. — are almost unheard-of in Singapore. Business lunches are extensive affairs, as well, often stretching into the 14.00 hour. When working with Muslim clients, avoid scheduling important meetings on Fridays.
Ready to Enter the Singaporean Market?
Any attempt to break into a new geographic market, particularly one as dynamic as Singapore, requires extensive preparation. You will need to do more than familiarize yourself with the items on this list before you are truly ready to set up shop in Singapore.
It’s worth the effort. With proper due diligence and careful forethought, your entry into the Singaporean market could create a vast new opportunity for your business. Of course, as in any endeavor, your success or failure is likely to come down to execution. In few places are the stakes higher than this tropical city-state.