Starting your own business is a difficult task that involves perseverance, drive and the right spirit. Deciding where to set up your business is almost as difficult.
There are micro-issues, which can take weeks if not months to understand and resolve. These include simple things like finding the right office space if you’re looking at retail – does it meet your parking and accessibility needs?
For the purpose of this article, we’re focusing on the macro-issues that will decide on whether you should be setting up your office in Singapore, Indonesia, Malaysia, The Philippines or any other market in the region. We are looking at the factors that many startup founders have to consider because it now easy to start your business anywhere due to many companies being software startups and not requiring retail space to build their business.
Here are some of the factors we need to consider.
Demographics and market identity
Though we just mentioned that you can start your business anywhere and there is no need for retail space, it is often easier and just practical to source for your initial customers at your home base. This means understanding the demographics of your home-base market.
There are dozens of factors to consider and these include;
- Does a sufficient percentage of that consumer or business population match your customer profile?
- Does the community have a stable economic base that will provide a healthy environment for your business?
Besides finding customers, you also have to think about hiring the right people. It depends on what skills do you need, and are people with those talents available? Are there enough qualified people that you can afford in your market and can you attract them to work with you?
For physical B2C businesses, foot traffic is crucial, so you have to identify markets that are still predominantly physical retail shoppers. This involves studying the local retail scene and identifying whether there is sufficient foot traffic available at your potential office or store locations to make it worthwhile setting up your company there.
The focus of your business
It might be 2019, but sometimes the mindset of your customers might still be lagging behind. This means the location of your business can impact whether your customers want to purchase your service or business.
Are you targeting local companies as clients or large MNCs – then having an HQ in a more established market with a better business reputation may be worth extra investment.
Entering a market that has great potential can also mean entering a highly competitive market, because of said potential. These are crucial factors because competition does not only impact revenue through low sales, but even impacts hiring due to higher demand than supply of talent.
Regulations, infrastructure and government support
One of the benefits of choosing your startup location is being able to take advantage of the local infrastructure and government support for new enterprises. Singapore has a clear advantage over the rest of the region, but the other markets are catching up quickly with new programmes and initiatives starting up on an almost daily basis.
Pick a good market that has grants or programmes that you can take advantage of for either little or even no equity. This can help you set up faster and offset initial capital expenses that can be challenging to a new brand.