In the second of our three articles looking at Business in Singapore, we shift our focus to eCommerce business Ideas and opportunities and how you can build a successful online business in Singapore in 2022.
The first question we need to answer is:
What is an eCommerce business?
Ecommerce is the activity of electronically buying or selling a product or an online service over the internet from an online store.
Buying or selling on Amazon, or from Etsy, is a form of eCommerce, and in itself, an online store, just a very big one (in fact we would call both Amazon and Etsy eCommerce platforms), as is dropshipping, and also affiliate marketing is another form of e-commerce business.
So as you can see there are lots of business opportunities in Singapore for your own online business if you follow this route.
Already here in Singapore, many entrepreneurs have set up their own online businesses focusing on an online business strategy outlined below.
Home based online business opportunities
All of these online businesses are a form of work from home business in Singapore, so if you’re tired of the corporate world and you want to change the direction of your life and become a business owner, the eCommerce business model could be the business for you.
All you need is a laptop, an internet connection, a good work ethic, practicing online marketing, and a little patience.
NOTE: This is not about data entry or being a virtual assistant, definitely not Google Adsense, or the print on demand business, and you will need a legal entity status to do these businesses, so whether you are setting up a private limited company or sole proprietor, you need to be registered.
Is it the right time to set up an eCommerce business in Singapore?
And, is Singapore a good place to launch a business idea?
The answer to both of these questions is a unanimous YES.
The eCommerce sector and online business in Singapore are booming, and since the pandemic Singaporeans have become very comfortable with purchasing online, and if you need, business finances and business loans are becoming more readily available.
We’re a nation that now enjoys online shopping and at-home delivery services. According to a study conducted by Nielsen, 37% of Singaporeans had significantly increased their online shopping, and 70% of new online shoppers are set to keep shopping online.
By the end of 2022, the eCommerce marketplace in Singapore is set to be worth $10bn, growing a massive 48% in 12 months.
And this massive growth is set to continue across the decade with many businesses bringing their offline business online.
Further incentivizing you to get into this area is the industrial environment here in Singapore, as a nation, we’re the perfect location to set up a small business, voted the best country in East Asia & The Pacific to set up a new business by the World Bank in 2020.
Also, our Government has many different initiatives, a business loan, and financial services to help get us started with our new online business. Also, with the coming growth, you will find financial institutions being more favorable towards this too.
Ecommerce Business Opportunities in Singapore
The list of small business / eCommerce business opportunities here in Singapore is massive, we could create a mini-library of online business opportunities for you, but for the purpose of this article we have focused on and evaluated 5 top-performing business types for you:
- FBA – Fulfilled by Amazon,
- Craft selling on Etsy,
- Dropshipping Business,
- Affiliate marketing,
- Influence/ Content Creator.
Evaluating each eCommerce business opportunity
To help you understand each of these at home business opportunities, so as to identify the one which represents the greatest potential for you we have evaluated them against these four criteria:
- What is this business opportunity/ how does it work?
- How easy is it to set up & maintain?
- What is the cost involved, and does it require significant Financial investment?
- Does it offer strong profit potential?
FBA- Fulfilled By Amazon Online Shopping
We’re all very aware of the Amazon business structure and the incredible wealth of its owner Jeff Bezos, but did you know Amazon has also made over 40K Millionaires and over 150K people make $100,000+ a year.
As an eCommerce opportunity, if you get this business venture right Amazon is a very lucrative option.
What is this business plan/how does it work: FBA or Fulfilled By Amazon is as the title suggests… Amazon sells your products on their marketplace and they send your products (from one of their mega warehouses) out once a sale has gone through.
What this does mean is you will need to bulk buy (usually 100+ items at a time) and you will need to get them delivered to Amazon, but after that Amazon looks after everything else, all the logistics, all the paperwork.
As a pricing model which most FBA businesses follow… ⅓ of costs goes to buying the products from a manufacturer, ⅓ goes to Amazon for the FBA services and ⅓ goes to you (but you will also have to pay for advertising costs out of this)
How easy is it to set up & maintain? If you find a winning product in a non-competitive marketplace (and you have the finances to bulk buy) then it’s super easy.
Setting up an Amazon account, setting up listings on the marketplace is all super easy, of course, you will need to take professional shots of your products (the more professional your products look the higher the price you can ask).
It all sounds very easy, unfortunately, it’s not. Amazon is the busiest market in the world, with so many potential customers, and as such you have a high demand of sellers from all over the world trying to get in on the act. New markets launch and if they become successful the competition for your business grows rapidly.
Does it require significant financial investment? Just following on from the previous point…you will probably have to spend quite a lot of advertising to boost your listing positioning.
Also, you will need operating costs, like buying all your stock upfront and going forward. Stock monitoring and replenishment are very important.
Amazon does not like the stock to be sold out, so you will need proper planning in place to keep an eye on stock levels, and you will need to replenish stock before it’s all sold out, which of course means buying more stock before you have taken all the revenue from the previous order.
Does it offer strong profit potential?
Get the formula right and (as I mentioned at the start there are 40k+ Amazon millionaires) the potential is massive and numerous advantages to selling with Amazon. But for every millionaire, there are a hundred failed business ideas, and many companies lose a lot.
There is massive potential for success on Amazon, but equally, there is massive potential for failure.
Don’t go into this with your eyes closed, there are no guarantees, and it’s risky as you will need a large chunk of up-front finances to get this business operation going.
Craft Your Own Online Business on Etsy
You’re a creative, an artist, an artisan, a designer, and you want to turn a hobby into a side hustle, well Etsy is the place to do it. Etsy is the perfect stay-at-home business opportunity.
The biggest craft and design marketplace in the world… with purchase-intentional target customers, so if you make t-shirts, paintings, photography, jewelry, or any creative perceived valuable asset and you want a place where people will want to buy it, read on.
What is this business opportunity/how does it work? Etsy is the biggest online craft e-commerce platform in the world. For a small monthly fee, you can list your items. Because Etsy has a dedicated purchase intent customer base many craftspeople have been very successful. However, it doesn’t offer the same financial opportunities that somewhere like Amazon does.
Also, you should be aware that Etsy is very competitive, and if one product in your store starts to do well expect other Etsy Artisans to copy the craft and sell similar products in their stores.
How easy is it to set up and maintain? It’s very very easy, but it really is all down to you. You create the products which are sold there, so you can choose when to add and or end different product lines.
Setting up Etsy again is a breeze, you will have your Etsy store up and running in 30 minutes. Again, the more professional it looks (in terms of photos and design) the more you will be able to ask for higher prices for your craft. Unlike FBA you will have to fulfill your orders. Etsy has a set of standards to which you will have to comply.
Does it require significant financial investment? No, but it depends on your operation. It’s up to you how much you want to create on a monthly basis and you decide the cost of the materials you will use to make your products.
So you will not have the upfront costs which you get with bulk buying stock for FBA. Like Amazon, most successful Etsy store owners will invest in a small marketing campaign.
Does it offer Strong Profit potential? It’s quite unlikely that you will be an Etsy millionaire, but I know a Jewelry maker based here in Singapore who is making nearly $100,000 a year selling jewelry on Etsy alone.
So there is potential there to create an online presence that booms in 2022.
Etsy is a great eCommerce platform for someone who wants to set up a small business and stay at home to sell online, where they can sell their designs and crafts online.
Online Business Of Dropshipping
Wolf mugs, Hawaiian shirts for dogs, Lion face hoodies, head massagers, fidget spinners… all dropshipping products.
Nonessential products?
Maybe, but they all have sold by the bucket load. And because of this, dropshipping has seen a massive boom since the start of the pandemic.
Why Are so many people testing out dropshipping? selling these crazy products on e-commerce platforms, well it’s because it is one of the lowest risk, easiest to set up business on the internet, where you don’t need payment upfront for your stock.
What is this business opportunity/how does it work? You find a product, most probably on AliExpress (which is classed as an online retail service) you create a simple one product website (people do of course create multiple products dropshipping sites, but one-product sites are the most popular and easiest to manage)…
You price the product at 3-5 times the cost on Ali-Express, you then market said product via Facebook Advertising or via the Google GDN. When people click on your site and purchase the product, it is only at this stage that you purchase the product (from AliExpress).
The product is then sent (probably from China) to your customer (by the manufacturer).
How easy is it to set up and maintain?
As you can see from the process above the dropshipping model is very easy to maintain. It is very low-risk as you never pay for the goods.
You never need to worry about re-ordering stock (you just need to make sure your supplier on AliExpress has enough stock). It all sounds super-easy, and it is but also it isn’t. It isn’t, because converting your marketing into sales is not as easy at all.
You may find people just are not interested in your Lion Face Hoodie, or if they are, there is going to be a lot of competition, and the bigger players in the market could out-spend you.
Does it require significant financial investment? No, it doesn’t. The major bonus here is that you do not have to buy stock, you never touch the stock, you pay for stock out of the customer’s money (and then you take all the profit).
This all sounds great. However, the area where you will find you will need to invest significantly is advertising. People do not know about your store nor the product you’re selling, so how are they going to buy it, you need to spend a lot of advertising.
You could find yourself spending hundreds even thousands of dollars without converting to sales. So you need to be smart with your planning or your project could spiral out of control financially.
Does it offer strong profit potential? It can, sometimes. The most successful dropshipping products have been big seasonal fads – think fidget spinners, the world went crazy for them for 3 or 4 months and then forgot about them.
The other area is useful products – a product which has sold massively was the travel cushion… Those people who travel a lot and can never get comfortable in airline seats want a little extra amenity, so when they see a product like this, they buy it. Maybe there is a possibility for a post-pandemic travel kit for the health-conscious traveler.
Dropshipping is a great business idea for Singaporeans taking their first step into their new entrepreneurial adventure. It’s low risk and if you choose the right product the rewards can be great but be careful, there are a lot of failures in this area too.
A Successful Online Business In Affiliate Marketing
Again another area that has seen rapid growth in the last 24 months. Again like dropshipping it’s attractive to new people setting up their own business, someone who is sick of the office slog and wants to set up a business that suits their lifestyle better.
Affiliate marketing does differ from dropshipping both in terms of the types of products you will sell and how you maintain the online business going forward.
What is this business opportunity/how does it work? You will be selling another company’s products, usually a digital product (like an education course), a content service (story blocks video subscription) an online service (like web hosting), or software (like affinity designer) via your website.
This website will be focused on a certain subject, say for example starting a new business in Singapore. You will create a lot of content for your site; long-form articles and educational videos. You will structure the content so 80% is educational and 20% is selling.
With the selling content, you will sign up for affiliate programs (for different brands selling web hosting or software, etc) you will integrate the affiliate links into the article, meaning if the reader decides to click on the link and make a purchase on the site you will make a commission.
How easy is it to set up and maintain? It is easy enough to set up, but you do want to make sure your site looks as professional as possible, you want your readers to trust you, if your site looks unprofessional readers will reject the content and not click on an affiliate link on your site.
So make it professional, but also you will need to be adding strong content regularly (daily if possible). This content needs to be educational and SEO friendly… trying to stay on top of Google’s algorithm can be a nightmare.
Does it require significant financial investment? Not necessarily, you do not have to worry about stock, you never need to keep an eye on stock replenishment (as everything is digital based) and a lot of people avoid using advertising and drive traffic via google…
One because it doesn’t cost anything and two because the traffic is intentional. However it will take a lot of time, and as the saying goes “time is money”.
Does it offer strong profit potential?
Yes, it does (if you find a lucrative market of intentional customers) but it may take a long time to achieve. It does not have the short-term profit potential like Amazon FBA, but it does have a longer sustainable business (and as such sustainable profit) potential.
Affiliate marketing is a great business opportunity for the dedicated stay home business creator. The potential is there, the risk is low, but you will have to work hard to achieve your goals.
Content Creation/ Influencer
Our final online eCommerce business opportunity for future Singapore companies, an area we toyed with…
As we weren’t sure if we should add it here, but we couldn’t ignore it, because love it or hate it, it’s here to stay, and for those that are successful at it, they are making significant money.
So let’s understand a little more about the world of Influencers as maybe it is the right business opportunity for you, especially if you are a whizz on social media pages, and think you can spot a target market ripe for your handsome/pretty face.
What is this business opportunity/how does it work? You find your niche: comedy, beauty, fitness, gaming, entrepreneurship, etc you build up your following on either Instagram or TikTok by the creation of regular topical content (more than likely videos). As your following grows so does your micro-community’s trust in you. You can approach brands (or they will approach you) and you can then sell their products via your content (click on the link below scenarios) making a commission from every sale.
How easy is it to set up and maintain? A Lot of people ridicule these content creators, but here at eAsean we admire their work ethic, these guys work hard, they have new fresh content up at least every day and most will have content coming out multiple times a day.
Speaking to any of them, they say making content is second nature to them now, but it took a lot of time to get to this stage. So it’s not easy to set up, but once you find your flow, maintaining the content creation process is a lot easier.
Does it require significant financial investment? Not really. You need a good camera (most modern phones have awesome cameras) some good lighting (spend $100 and you will get everything you need to get started) and some video editing software ($200-400). Every cost after that depends on the type of content you create.
Does it offer strong profit potential? Yes, we know lots of tiktokers making MILLIONS. But also no, there are lots of “influencers” struggling to make anything. So be clever, choose an area in which you could gain notoriety quickly which will have a lot of brands interested in reaching the audience you provide.
Not for everyone, but not to be scoffed at, as many have turned Influencing into a real business, if you get the magic formula just right you will be the winner, but expect to work hard as you will be creating content multiple times in a day.
Conclusion For The eCommerce Business Ideas Singapore Article
The e-commerce business in Singapore offers lots of opportunities for new entrepreneurs. If you want to create your own business, the best place to start in 2022 is to create an online business… an eCommerce business.
What you choose, as a future business owner will come down to your ambition and your funding. Will it be a small business/a stay at home eCommerce business or an eCommerce enterprise… the possibilities are there for you.
One further thing to consider is the advent of the metaverse, the next stage in digital connectivity, the new frontier of socializing and digital marketing, the virtual reality world of web 3.0, how will it affect these ideas we have discussed above, because believe me, it will.
To find out more about the metaverse and how it affects business here in Singapore check out our deep dive here, plus do your own market research, get it while it’s in its infancy and big business hasn’t overtaken every angle.
Finally, join us in the third and final Business ideas Singapore article where we deep dive into the top digital marketing business ideas for all you budding stay-at-home entrepreneurs in Singapore.
FAQ
What Skills Do I Need For an eCommerce Business In Singapore?
The skills you need to become a successful business owner are outlined below and will drastically improve your success if you understand digital marketing and how search engines work.
There are plenty of online courses you can take on topics the likes of search engine optimisation, also known as SEO, social media marketing, the likes of Facebook Ads, and even how to do website marketing, like design elements and content elements, etc.
Also, if this is too much for you, many business owners use a social media management company that can look after their business. Just like hiring web designers to make your eCommerce stores look great, you can also hire a social media manager to look after your business online.
They have multiple clients and specialize in social media, just like a freelance web designer will focus on design and an accountant will focus on accounting services.
- Metaverse in Singapore – 5 Businesses That It Will Boom - November 26, 2021
- 5 Ways the Metaverse will affect business in Singapore - November 24, 2021
- Inside Metaverse, What Is It and how will it affect business in Singapore? - November 23, 2021