Starting Your Business Right – 5 Key Considerations Before Starting Your Business

Starting your business right in Singapore: The 5 key considerations before starting your business. “The secret of getting ahead, is getting started.” – Mark Twain Starting a business in Singapore? We have lived in a world where few countries revelled in economic prosperity while the bulk of countries watched with envy, wishing to share similar opportunities. Now, we live in a global economy, where every country is able to engage, contribute and benefit from the trading of goods and services across the globe. Singapore took the opportunity to rise up the ranks as a nationwide super-hub for businesses to start, grow and prosper. The country provides many advantages for an entrepreneur who wants his business to grow in its prosperous environment. For instance, Singapore is strategically located as a business hub in Southeast Asia amongst prospering countries like China. It is politically and macro economically stable, while its tax systems and modern infrastructure perfectly positions the country as an entrepreneur’s haven. Such great business environment and economic opportunities prove to be attractive for budding business owners, corporations and investors. Entrepreneurship at its peak Entrepreneurship and capitalising opportunities go together – The process requires a business person who is ready to take risks with that unique DNA in their persona to take action. Starting a business can be stressful. It often feels like there are a thousand things to work on at the same moment. In such a reality, meticulous planning, creativity and perseverance will make it way easier for the business to thrive. The 5 key considerations to think about when starting a business Beyond giving it your all, it’s important to direct your energy to the right areas of focus – especially when you before you are planning for the incorporation of your company. With proper research and assessment of the legal aspects of your industry, you will be able to work on your personal and business finances, the range of risks involved and the adequate timing and help required. The first thing you should think about is your business model! 1. Planning your Business Model In a traditional business model based on one-time sales, revenue is prone to market-based fluctuations with consumer sentiment a key determinant. The recurring revenue model guarantees the business a certain amount of revenue at scheduled intervals. The key question to ask yourself when starting a business is – Is your revenue based on recurring or one-time events? In traditional business models, you acquire a customer, sell your product once, and then get a new customer to make another sale. Though acquiring a new customer generates the initial sale, making new sales to existing customers is simpler than finding entirely new ones who have yet to discover your product. In subscription business models, customers pay a weekly, monthly, or yearly fee in exchange for your products or services and it initiates recurringly. Customers can renew their subscription after a certain period of time. This model allows you to leverage your customer relationships to create a steady stream of income. A subscription-based business will give your business sustainable cashflows for operations. Subscription business models are beneficial for many organizations because they encourage long-term relationships and improve buyer retention. In current times, subscription models are used in almost every industry. Up-selling and cross-selling are a lot easier with a recurring revenue model, where businesses have continuous contact with customers to build bonds of trust, which makes it easier to sell additional services. For the right product, brand and industry, choosing the right business model for your company can be a very effective and lucrative approach to running your business. 2. Knowing Your Customers Next comes your customers. They are your key sources of income. The reason why your business model is up and running is to meet their needs. Are you a B2B or a B2C business? Your go-to-market strategy will differ with either. Being able to find out and understand your consumer needs is crucial for every successful business. With this, you will be able to persuade existing and potential customers that acquiring your products or services is in their best interests. If you’re selling to other businesses, you’ll need to know which individuals are responsible for the decision to buy your product or service.  Every market strategy requires a great deal of market research of existing reports, business trends, consumer buying habits and needs, and competition in the industry. These will lead to you building greater confidence and foresight in the trends that are going to influence your customers, which in turn help you anticipate what they need. Your business needs a reason for your customers to buy from you and not their competitors. This is called a Unique Sales Proposition (USP). Your USP can change as your business or your market changes, and you can have different USPs for different types of customer. All USPs are effective to the right audiences as their buying decisions have a direct correlation to the unique core features of your business. It’s also useful to be in the know of the USPs of your competition. The key factor is setting apart your USP from others in other to stand out from the market. 3. Understanding Your Margins With proper understanding of your target audiences, make sense and interpret your Gross Margins and Net Margins. This is proof of the sustainability of your business. Your margins must make sense. When calculating your business margins, you will gradually have to factor in any affecting factor that has significance to your business – the more you factor in, the more accurate a picture you will get of your true profit margin. Operating profit margin accounts for operating costs, administrative costs and sales expenses. It includes amortisation rates and asset depreciation, but it does not include taxes, debts, and other non-operational or executive-level costs. It tells you how much of each dollar is left after all the operating costs to run the business are considered. Net profit margin is the toughest type of profit margin to track, however it gives you the best insight into your bottom line. It takes