People might question why I choose to write a blog post about e-commerce in a small country like Singapore. China’s e-commerce market is growing faster and receives more media exposure for sure. Though, one shall bear in mind that Singapore is a well-developed country and it’s easier to manage businesses there from many aspects. In this article I present how you can start an e-commerce business in Singapore today.
Benefits of starting an e-commerce business in Singapore
If you plan to go global and sell products via e-commerce sites, I recommend you to implement a strategy where you enter one country at a time. And Singapore can be a great market to start with. Entering several markets at a time can jeopardize your exports and customers’ satisfaction if problems occur. It’s better to start with one market at a time and expand to other countries once everything is set up and under control. Below I list some of the merits to start an e-commerce site in Singapore and aim for expansion later:
- The country is small and you will find it easy to handle logistics and shipments.
- The country has a population with a strong purchasing power.
- The country has a well developed and better internet connectivity.
- You can easily communicate with Singaporeans as they speak good English.
Rents are expensive in Singapore and you can save loads of money with your virtual store online.
Labor costs are not expensive in comparison with Western measures, though you can save costs here too.
The fastest growing e-commerce sites in Singapore
There are plenty of e-commerce platforms in Singapore, and more are coming. TechinAsia has written a great article that presents the e-commerce sites they predict will grow fastest in Singapore during 2014. I listed five of the sites, with a short description of the product categories those offer:
- Reebonz/Kwerkee – Reebonz offers luxury products such as high-end handbags. Kwerkee was launched in 2012 and sell house-hold items an gizmos.
- Qoo10 – Is originally from Korea and is a huge marketplace for clothes, gadgets and groceries.
- Redmart – Was established in 2012 and is one of Singapore’s fastest growing e-commerce sites. The website sells household and grocery products.
- Luxola – Was launched in 2011 and sells for beauty and cosmetics products.
- Opentrolley – Started in 2008 and claims to be the leading online bookstore in Singapore.
Worth mentioning is that big websites like Rakuten and Alibaba has entered the Singaporean market. These websites will for sure increase the Singaporean people’s awareness of the benefits to buy via e-commerce, such as:
- Competitive prices.
- Quick deliveries all the way to the door.
- The convenience to shop online.
- Vast product ranges.
- Good overview and customer ratings of products.
Web-design and marketing
You can’t convince a visitor to buy your product if you don’t have a good looking website. But unfortunately that’s not enough. You also need a website that is fast-loading, has clear and easy payment terms, nice and clear product descriptions and preferably content in the native language of the visitors.
Small business owners often lack sufficient web-design skills. In addition, many of them can’t afford to hire pricey web-designers, interpreters or other professionals. I have a better suggestion for you: Hire a freelancer. You can find freelancers on pages like Odesk with sufficient capabilities, but for a fraction of the price. People who previously hired these freelancers can also rate them.
Different countries and cultures require business owners to apply different marketing strategies. You shall preferably find a person who has a good knowledge in web-design aimed for Singaporean people. You can add such requirements if you look for people on Odesk or Elance for instance.
I recommend you to visit a website called 99designs. Their service is easy to use and affordable. Business owners and bloggers can choose one of four design packages called bronze, silver, gold and platinum. The bronze design package is cheapest and the platinum most expensive.
After you chose a design package, a contest is launched where web-designers help you to design your website. In parallel, you give them feedback and share your preferences. After seven days, the money is paid to the person who creates the best design for your website. If you choose a more expensive design package, you can attract better web-designers and the competition is more fierce.
Payment options for your e-commerce site
Payment solutions are as important as the web-design for your e-commerce site.
Your payment solutions shall be optimized to meet customers’ preferences and to make them satisfied. The following items must be available on your site when your customers are ready to buy your products.
Gateway processors for payments
You can implement a gateway processor that is integrated into your website. You need to pay more money for this solution in comparison with a third-party credit card processing system (see below). In addition, monthly fees and transaction-fees are added.
But there are benefits with this payment option. The customers can finalize the payments more easily and quickly as they don’t need to have an account with a third-party. Paypal is one example of a gateway processor.
Third-party credit card processing system
If you want a less pricey solution, you can go for a third-party credit card processing system. Your customers will be re-directed to the third-party to complete the sale. This solution is not as convenient as gateway processors, however many websites use it and people are in general used to it.
One landed price
Your customers must find it easy to purchase products from your website. There’s one word that must apply to your website: Simplicity.
The price of your products shall include the original costs, customs and tariffs, insurances, packaging costs, currency conversions and handling fees. No one wants to buy from a website that continue to add costs from one page to another in the purchasing process. Probably you have experienced this from websites that sell plane tickets. And it is frustrating for sure.
Different currency options
If you have worked with international sales, you probably know the risks by offering prices in different currencies. Fluctuations and weak exchange rates can afflict a small business owner severely if it lasts over a longer time. I still recommend you to offer the prices in different currencies, especially the currency of your target country if it’s not too risky. The Singaporean dollar (SGD) is rather stable and equals to 1,50 USD or 2 euros. Hence, I can’t see any issues for e-commerce sites to offer prices in Singaporean dollars.
- Singapore is a small country, but has a population with a strong purchasing power.
- The Singaporean people speak good English and you won’t have issues to communicate in English.
- E-commerce grows fast in other markets for sure, like China. To start an e-commerce in Singapore and aim for expansion later can be a great choice.