This article was brought to you in collaboration with DBS Bank.
Hey you! Yes, you, reading this article on your mobile as you try your best to distract yourself from the stress of work. Have you ever thought of getting away from your desk-bound job? Do you want the freedom to be your own boss, and dictate your own working schedule? Well, have I got the perfect solution for you!
Just sign up for… what? That’s not a Multi-Level Marketing company? It’s actually an illegal pyramid scheme? Darn. Sorry to get your hopes up.
Wait, wait, wait… but you’ve already got me thinking about being an entrepreneur! Don’t stop now!
Okay, if you’re sure that you haven’t actually signed up for some illegal pyramid scheme or other scam, your journey towards starting your own Singapore business can begin. Assuming you already have a product or service in mind that you want to create and sell. You would expect the logical thing to do first, of course is to contact the Accounting and Corporate Regulatory Authority (better known as ACRA) and register your company.
But the truth is, there are three things that every entrepreneur should think hard about even before they proceed to register their Singapore company. And don’t think this applies only to tech start-ups. Everyone from an Uber driver to a team opening a yoga studio can benefit from these three tips.
1. Is the product you’re selling a fad or long-term mainstay? Does it rely on outside market factors?
It’s easy to jump on a bandwagon. It’s harder to stay on it. Singapore businesses come and go, and sometimes, when you’re too caught up in a fad, it’s easy to lose track of the steps you need to take to sustain your business. I’m constantly reminded of the bubble tea craze back in the early 2000s, and how Singapore was once full of hopeful entrepreneurs opening stalls to cash in on this fad.
Unfortunately, the competition got so intense that a price war began and people were forced to sell bubble tea below cost, eventually resulting in many shops closing. Ironically, several years later, bubble tea in Singapore is now considered a luxury item and can sell for at least $3 a cup, which goes to show that the product did have long-term demand, and most individual entrepreneurs were just unable to hang around long enough to escape the bandwagon.
So before you register your company, make sure you and your product are able to overcome the competition and outlast the bandwagon. Which brings me to my second point.
2. It’s more than the product; do you have the right people in your company?
In this day and age, it’s hard to imagine Apple without its co-founder Steve Jobs. But there was a time in the mid-1980s when Apple actually got rid of their visionary founder for several years! At the risk of glossing over much of Apple’s lengthy history, Jobs eventually returned to Apple and eventually ushered in the technological revolution that was the iPod and the iPhone. Of course, there’s no doubt that Apple also consistently attracted some of the most innovative minds to work for them, under Jobs’ leadership.
Ask any start-up entrepreneur, successful or otherwise – the initial stages of building a company are brutal, and often require long hours, sleepless nights and little to zero financial returns. The people building this company with you need to have the mental and emotional resources to survive this initial stage if you’re going to get anywhere. And you can’t be worrying about the minute details when your entire company’s at stake. Which brings me to my third, and perhaps most important point.
3. Do you know how to avoid getting bogged down by the nitty gritty details?
Most good entrepreneurs are visionaries. They can see the end goal clearly, they know what they want to achieve at each stage of the business, and they’re willing to put in their blood, sweat and tears to get there. But often, because they tend to be big picture idealists, they usually end up ignoring, or worse, avoiding the fine print that comes with running a company. And, more often than not, handling the technical details is what causes them to burn out over time.
Which is why it’s important to look for corporate services that will help you deal with the nuts and bolts of running a company, freeing you up to pursue that vision. Now this can normally be done by a law firm, accounting firm or corporate secretarial firm, that has experience in setting up companies. But for some new businesses, you probably can’t afford to spend thousands each year on such corporate services. That means, for something simple like opening a corporate bank account, you will need to spend time collating documents and then going to a bank branch in person to submit them. That’s assuming you’re planning to bank with OCBC and UOB.
With the DBS Business Account, the hassle of queueing up at a branch is a thing of the past. Opening a DBS Business Account is simple. It starts with a short online application, then a short call from a DBS relationship manager, followed by a courier from DBS to pick up the necessary documents from you. There’s no need to apply at a branch.
Wait, that sounds way too good. What’s the catch here?
Compared to UOB and OCBC’s business banking accounts, the DBS Business Account has a relatively high minimum average balance of $10,000 per month. But let’s be fair here – if you can’t even maintain a bank account balance of at least $10,000 a month, then maybe it’s not the best idea to go into business.
Here’s a quick comparison of the business accounts offered by our local banks:
|DBS Business Account||OCBC Business First Account – Lite||OCBC Business First Account – Value||UOB Current Account|
|Minimum Balance||$10,000||$5,000 – no minimum balance for first 6 months||$5,000 – no minimum balance for first 6 months||$10,000|
|Account Annual Fee||$40||$38||N/A||N/A|
|Account Monthly Fee||N/A||N/A||$38 – free for first 3 months||N/A|
|INTERNET BANKING FEES|
|Internet Banking Fees||Free||$25 monthly – free for first 3 months||Free||Free|
|Mobile Banking App||Yes||No||No||No – only a mobile responsive website|
|Security Devices||Unlimited free devices + free Digital Token||1 free device($20 per extra device)||3 free devices($20 per extra device)||No free devices ($20 per device)|
|For the first year for a company with 2 internet banking users who meet the minimum balance||$40||$38 + $225 + $20 = $283||$38 x 9 = $342||$40|
You might have missed a subtle change that has been made recently but compared to OCBC, the cost of maintaining a DBS Business Account is significantly lower, and this is because DBS IDEAL’s Internet Banking fees have been removed for good.
Previously, if you applied for a DBS Business Account online, all internet banking fees were waived, which means you only pay $40 a year for the account. But now that has been removed completely. Better yet, where they had previously allowed for 5 free tokens, there is now no cap on the number of tokens that can be issued and you can get as many as necessary.
Also, there is no cost on replacing old tokens so “maintenance costs” for the account are zero. In addition, the Digital Token will also available free to all users, accessed via the IDEAL mobile app.
Do note that DBS is the only one that currently offers a truly functional mobile app
To date, only the DBS mobile app allows you to make account enquiries and transactions on your business account, book foreign exchange transactions, as well as giving you access to subsidiary accounts both within Singapore as well as overseas. In comparison, UOB’s BIBPlus mobile “app” is actually just their usual website, optimised for mobile usage. Currently, you’re only able to make account enquiries on the go, but are unable to do any actual transactions.
As any good business owner knows, being able to make financial decisions on the go puts you at a distinct advantage. Speaking of advantages, that’s not the only way DBS can help you.
The DBS experience doesn’t end with opening your corporate bank account
Yes, opening a DBS Business Account may be an easy and wallet-friendly short-term decision, but there are also the long-term benefits of being part of the DBS BusinessClass community.
More than a mobile app, this is an invaluable experience that only DBS is currently offering. It allows you to network with over 15,000 entrepreneurs and business leaders in the region. You also get invites to exclusive networking events like the DBS Bay Area Series and Disrupt @ The Bay series of events that allow you to meet industry influencers, venture capitalists and global tech companies with disruptive solutions that can help your business innovate to improve productivity. All these resources will give you and your business the edge it deserves.
The Bay Area Series, for example, invited Silicon Valley-based venture capitalists Ernestine Fu and Tim Draper to speak to local entrepreneurs, speaking on a variety of topics including venture debt and venture investing.
Are you a Singapore business owner? What other tips and tricks would you have for new entrepreneurs even before they register their company? Share them in the comments.