Fast becoming one of Asia’s most pivotal economic hubs, Singapore shows no sign of slowing down. Since gaining independence in 1965, The Lion City has been consistently acknowledged as one of the most open economies in Asia.
The city-state’s first-class infrastructure, political stability, skilled workforce, and prudent economic management have developed Singapore into one of the most thriving business environments throughout Asia and the rest of the world.
Singapore’s high income, digital-savvy population also makes it an ideal e-commerce market for any small- and medium-sized enterprise (SME). Many European air freight carriers operate direct flights to The Lion City, making air freights to and from Singapore convenient, easy, and affordable.
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This article looks at why you should consider Singapore as your next port of call if you’re looking to expand your e-commerce business to the Asian subcontinent.
1. A sophisticated digital economy
Singapore’s mature e-commerce market is rivaled by very few. Eighty-five percent of its nearly six million population are active internet users. Of the nearly five million active internet users in Singapore, 90 percent searched online for a product or service to buy.
Singapore’s e-commerce shoppers are high-income individuals who tend to have big basket sizes. On average, Singaporeans spend more than US$1,000 on online purchases. This average spend is significantly higher than the global average which stands at US$634.
The lion’s share of online purchases tends to come from the consumer goods sector: clothing, electronics, groceries, furniture and toys.
2. Strategically located
Situated in the heart of Southeast Asia, Singapore is close to many of Asia’s fast-growing markets. This strategic position allows Singapore not only to serve Asia’s growth markets, but also to build linkages to regions further afield such as the Middle East, Europe, and the United States.
Its network of trade agreements with some of the world’s major economies also makes Singapore a significant hub for global investors.
From a logistics standpoint, Singapore has deep roots in transshipment activities.
The Port of Singapore is a critical gateway in Southeast Asia, offering connectivity to 600 ports in over 120 countries. This trading port has been a key contributor to the city-state’s economic development and growth.
However, ocean freight is not the only way to transport goods to and from Singapore. Singapore is well-serviced by an expansive air freight network. This provides SMEs with the reliability they need to move a wide range of freight shipments.
SMEs can use online shipping platforms to access instant freight quotes to and from Singapore. This determines the most economical choice and carrier selection according to their business requirements.
3. A transparent business haven
The government of Singapore is heavily invested in providing a clear legal framework and good corporate governance practices. SMEs looking to do business in Singapore will find simple and effective trade regulations and strong copyright laws for the protection of intellectual property.
Singapore’s many multilateral free trade agreements (FTAs) means SMEs from established markets have preferential access to government procurement and favorable tariff rates. By lowering or removing tariffs on goods, SMEs abroad can remain competitive in Singapore’s e-commerce market.
4. Low barriers to entry
One of the most challenging aspects of international e-commerce is localization. For SMEs that operate an English-language e-commerce store, language can become a significant barrier to entry.
This can hinder the online shopping experience and result in high cart abandonment rates.
This is not the case in Singapore. As one of the city-state’s official four languages, English is uniformly adopted throughout the country. Singapore’s English proficiency is ranked fifth in the world, the highest-ranking for any Asian nation.
Of course, language is not the only barrier to international expansion.
Each foreign market has a preferred payment method. Fortunately, many global e-payment platforms are available in Singapore. Credit cards are ubiquitous here, making it easy for SMEs to cater to Singaporeans’ payment preferences.
5. A comprehensive infrastructure
Rated as one of the best infrastructures in the world, Singapore boasts a comprehensive framework of public roads and ocean and air freight connectivity. This efficient network enables SMEs to streamline its supply chain.
Accessibility to these well-developed transport links ensures that deliveries are done in a timely manner.
Aside from its physical infrastructure, Singapore also maintains one of the best telecommunications infrastructures in Asia. Internet speeds, on both mobile and broadband, are only second in the world behind Norway.
A strong telecommunication infrastructure means SMEs can scale their online store to maintain consistent site availability. This allows online merchants to deliver a better online user experience for e-commerce shoppers.
Thanks to Singapore’s robust telecommunications infrastructure, online merchants looking to branch out to Singapore will find that technical issues such as downtime, slow page loads, data privacy, and security performance are easier to manage.
Singapore: Your Next Port of Call?
If your home market is starting to feel saturated, then it may be time to expand your e-commerce business beyond your borders. Online retailers looking to expand should try to further their reach in markets that have a strong demand for their products.
SMEs should also look to destinations that strongly support foreign entrepreneurship.
As a global market, Singapore offers SMEs ease of accessibility and a digital-savvy demographic. If your business is eyeing a Southeast Asian expansion, few destinations are as attractive as Singapore
AUTHOR BIO
Paul Rehmet is the Chief Product Officer for Shipa Freight. He is responsible for translating the company’s vision into an easy-to-use online freight platform for its customers. In his 25-year career, Paul has held various technology leadership positions with early-stage startups and Fortune 500 companies including Unisys, Destiny Web Solutions, and US Airways.
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