In the age of global interconnectedness, expanding businesses beyond the borders of your home country is more feasible and promising than ever before.
As the world economy becomes increasingly integrated, businesses are recognising the tremendous growth opportunities that international markets offer.
However, global expansion poses a myriad of challenges, like domestic currency control or brand perception in foreign countries.
When large corporations expand their operations, they allocate substantial budgets on strategic planning coupled with efficient execution.
Luckily for small businesses, a smart and-budget friendly move – incorporation your own Singapore company – lifts almost all the barriers and substantially improves your brand image in the eyes of global customers.
In this context, leveraging crucial support services can be a game-changer.
A prime example of such support is provided by SAVVY PLATFORM, a comprehensive business solutions provider aiming to bolster Singapore's position as a leading destination for business ventures of all scales.
Challenges of the Global Expansion
Currency Control
Currency exchange controls are government restrictions that limit its residents' ability to purchase foreign currencies and limit purchases of the home currency from abroad.
These are the most common currency controls:
- Banning or limiting purchases of foreign currency within the country;
- Banning or restricting the use of foreign currency within the country;
- Setting exchange rates (instead of letting the value of the currency fluctuate according to market forces);
- Restricting currency exchange to retailers approved by the government;
- Limiting the amount of money that may be imported or exported;
- Mandatory conversion of foreign currency revenues into local currency.
Even the biggest emerging economies – China, India and Brazil – have currency control rules and regulations that weaken the abilities to sell on global markets.
Brand Perception
Historically, customers associated certain products with countries and territories where these products were produced or arrived from, e.g. Indian tea, Brazilian coffee and so on.
"China" is equal to "porcelain" in English.
In the industrial era, when more goods started to be produced, this perception covered certain products and industries.
We differentiate between "German Cars", "Japanese Cars", "Korean Cars", like cars represented by different brands from the same country have something in common.
In the post-industrial era definition of "product" includes software that solves certain problems of individuals and other businesses; however, differentiation that starts from geographical location is still there.
Products from 'developed economies' are considered to be of better quality than their substitutes from emerging economies.
Thus, the country of the product origin affects customers' choice even in the 21st century.
Legal Protection
Different countries have different views on how to protect customers' rights, shareholders' rights, how to solve disputes between businesses and their clients and so on. The more expensive your goods and services are, the more they depend on the legal system of the country where you start your business.
Doing Business Practices
Two polar models of the economy are complete economic freedom and a totally restricted economy.
Of course, the economic model of a particular country is somewhere in between these extreme points.
In a freer economy, businesses can enter any industry with very low barriers.
On the other side, detailed regulations in some critical industries, like banking, insurance, healthcare, transport and defense, aim to provide a stable foundation to other industries and increase the overall safety of doing business and living in the country.
Internal Limitations
Every step comes at a cost.
For physical products, selling on new markets means producing additional units and delivering them to selling points.
Digital products and services are more about brand awareness and the efforts of the marketing team.
And it's important to remember that the resources of any business are limited.
The major limitations are the money and the team.
And the key to successful expansion is to reach the desired goals with available means.
Principal Question of Business Expansion
As you can see, there are predetermined factors that substantially contribute to the final success of a business's global expansion program.
- How does my product look in the eyes of my foreign customers? or
- Does my offer match the new audience?
All epic fails when entering new markets result from silly mistakes that could have been avoided.
Here is a couple of them:
- Gerber marketed baby food in Africa with a cute baby on the label without knowing that, in Ethiopia, for example, products usually have pictures on the label of what's inside since many consumers can't read.
- Mercedes-Benz entered the Chinese market under the brand name "Bensi," which means "rush to die."
Big companies' mistakes are expensive but not critical, while the mistakes of smaller companies can bankrupt them.
Countless cute little brands disappeared because of scaling mistakes they made.
Perhaps the most known of these unknown brands is Penny Blossoms from Big Bang Theory (Season 2, Episode 18).
Big Business Approach vs. Small Business Approach
When the budget of your planned expansion is relatively low (less than one per cent of current sales), you may prefer to establish a physical presence in the country where you are going to expand your business.
That's how big businesses usually behave - for the expansion matters, they consider themselves cash-rich enough and accept any budget that looks reasonable to them.
Small businesses understand that they cannot afford setting up a presence in all the countries at once, so they choose to do it step by step or apply smarter strategy operating business from a handful of strategic locations.
That's where Singapore enters into play.
The Discreet Charm of Singapore for Global Expansion
Instead of thinking how to cope up with restrictions and limitations in many countries, you should assess setting up a Singapore company for your global expansion.
And here's why:
- Strategic location and great connectivity. Singapore is located in the heart of the fastest-growing region of Southeast Asia and is very well connected to all parts of it. Location and connectivity make Singapore an ideal place for setting up a regional headquarters of your business.
- Economic freedom. Recognised as the World's freest economy by the Heritage Foundation, Singapore provides an excellent environment for entrepreneurs, including convertible local currency and liberal foreign exchange rules.
- English is an official language – all the Singapore laws are written in English. Singapore made this choice in the early years of independence, but at that time, English was already a common language of business people. So, from the very beginning, Singapore became integrated into global business environment.
- Good for both operating and holding purposes. Singapore companies are suitable for transactions with many countries. On top of that, accounting rules in Singapore are favourable to businesses, and the taxation is moderate. Singapore does not tax capital gains, and incoming dividends received by Singapore companies are generally exempt from corporate income tax.
- Excellent Business Reputation. Modern Singapore has a reputation as a smart city governed by the rule of law. That's why Singapore is a must-have for businesses selling internationally:
- As an operational unit for overseas businesses that sells products to customers based globally; or
- As an investment vehicle to accept funding from overseas investors and save on capital gains when exiting the project.
The Role of Support Services in Expansion
Support services like those offered by SAVVY PLATFORM are invaluable for companies aiming to navigate the complexities of international business.
These services not only facilitate the initial steps of entering a new market but also contribute significantly to sustaining operations.
How SAVVY PLATFORM Assists their Customers
SAVVY PLATFORM specializes in supporting businesses at every stage of their growth and expansion.
For companies looking to go global and use Singapore company as a tool for global expansion, our comprehensive service suite addresses several critical needs:
- Savvy Start: Incorporation of a Singapore company becomes effortless, making it a compelling springboard for international ventures.
- Savvy Secretary: Administrative support ensures that your focus remains on strategic business activities rather than mundane paperwork.
- Savvy Smart: This service provides tailored solutions for statutory compliance, office space procurement, and business licensing—key components for establishing a legal and efficient international operation.
Importance of Local Insights and Compliance
Understanding local laws, regulations, and compliance requirements is crucial.
SAVVY PLATFORM's expertise in handling such matters ensures that your business transitions smoothly into new markets without facing legal hurdles.
Fostering Cultural Exchange and Learning
Understanding and respecting cultural differences is crucial for global business success.
By fostering a culture of learning and exchange within your organization, you can enhance your international business competence.
Contact SAVVY PLATFORM Today
Ready to take your business to the international stage?
Contact SAVVY PLATFORM for expert support in every step of your expansion journey:
- Visit us: SAVVY PLATFORM
- Mail: iamsavvy@iamsavvy.com.sg
- Call us: +65 9711 8886 (Singapore)
- Or: +7 707 6836458 (Kazakhstan)
Check your company name availability for incorporation with SAVVY PLATFORM today: COMPANY NAME CHECK.
Conclusion
Expanding your business internationally may be challenging due to operational limitations in your home country or insufficient business reputation.
Singapore company is a great solution and a must-have tool for both operating and holding purposes.
Choosing your supporting partner in Singapore is equally important.
At Savvy Platform, we specialise in assisting small businesses and startups to achieve their global expansion ambitions by providing comprehensive and budget-friendly corporate services in Singapore.
With the right strategy, tools, and support, your venture can transcend boundaries, leveraging Singapore's dynamic business environment as a springboard to the global stage.
