Friday, 9 October 2020

Singapore is still great for business – but not for everyone

*Produced by SilverKris for HC Consultancy*

Throughout her decades-long career, corporate lawyer and business consultant Helen Campos has had a front-row seat to the ups and downs of the trade. Since its founding in 2007, her corporate secretarial, accounting & tax advisory firm, HCSS, has worked with thousands of Singaporean and foreign clients across sectors ranging from F&B to medicine to charitable organisations.

In all her experience, though, she says she has never seen a moment like this. “This is worse than 2008,” she says, sitting in her office in Coleman Street, where her team handles everything from company registration, shareholder agreements and disputes to tax advisory for their clients. “It has impacted every industry in a different way.”

Asked to elaborate on what she means, Helen goes on to explain the unique challenges of certain industries, as well as the double-edged sword that is digitalisation.

Singapore skyline businesses central business district
Singapore has traditionally been seen as a stable and conducive location for businesses. Photo credit: Shutterstock.com

What have traditionally been Singapore’s business advantages?

Singapore is a very attractive place to register a company to start a business because it has political stability, good infrastructure, a skilled English-speaking workforce and a transparent and attractive tax system. In addition to this we have a very proactive government that places a lot of importance on promoting Singapore as an ideal business location. The Singapore government courts MNCs and entrepreneurs from all over the world, inviting them to set up their companies here. This commitment can also be seen through the increasing number of grants and tax deductions available to both local and foreign companies.

Singapore’s geographic location in the heart of Southeast Asia is quite ideal. We are in close proximity to the emerging markets of India and China. We are also in a unique position in the global economy and play a pivotal role as the business epicentre of Asia.

How does the current pandemic climate impact that?

The work has slowed down in many industries including professional firms, tax, accounting and law firms. For the trade industry, due to the global impact of Covid, businesses are suffering from shocks to both supply and demand. However, the crisis has also elevated some industries, one of which is e-commerce.

What’s the effect on the job market?

Our reliance on foreign labour is not the best ideology in these turbulent times. Instead, we have to restructure our economy for a more sustainable future. While we have reserves to preserve jobs and sustain our economy, we cannot expect to return to what the economy was before once the pandemic is stable. However, the government has introduced many support schemes for job seekers to utilise, such as the SG traineeship contracts and the Jobs Support Scheme.

Amidst the Covid-19 pandemic and its many consequences, we are being forced to rethink a lot of what we have considered the norm. This includes how and where we work. Working from home has taken a whole new meaning in the face of the pandemic and we are now learning that many of us can and should shift to a new normal in terms of the way we work. This could very well be the new normal for us all.

brainstorming business ideas
Whether you should start a business now depends on the industry you’re looking at. Photo credit: Shutterstock.com

What would you say to someone looking to start a business now?

It would depend largely on the type of business – there’s no blanket advice that addresses everyone at this moment. In my personal opinion, I would advise strongly against an F&B venture right now. Singapore has a glut of restaurants, many of which are folding as fast as they open. Businesses built around specific skillsets, however, might be better positioned in this climate. Telecom companies, for example, are better situated as their business has only been mildly disrupted, if at all. Technology-centric companies are in a better place as well, as each industry is now forced to reckon with the need for tech upgrades, even if they had been resistant in the past. At the same time, for the labour force, even technology, in my opinion, is a double-edged sword.

How so?

Many firms have migrated their operations onto the cloud and implemented work-from-home arrangements. Employers who have been forced to abide by government rulings will now start to think more seriously about outsourcing their work to other countries, such as Malaysia, the Philippines and India. Now even staff working remotely could tap into their software and do the work from abroad – mind you, at a fraction of the cost. This is a push factor for employers to seriously consider as it equates to huge savings. This is why I say digitalisation can be seen as a double-edged sword. Singaporean workers will see competition for such jobs increase sharply. Even in the field of legal research, employers may wonder, “Is a full-fledged, in-house legal team really necessary? Lawyers in India, Malaysia or the UK are just a click away – it’s all English law anyway.” Employers are likely to consider working with skeletal staff in Singapore and outsource their legal research teams overseas. Certainly, back-end work and data entry can be done remotely.

There’s talk of MNCs now thinking twice about having offices in Singapore. What’s your take?

It will depend on the industry. For certain types of research and development work, Singapore remains the best option in the region, with skilled researchers and good infrastructure. To my knowledge, certain aspects of law practices, accounting, architectural and engineering can be outsourced, while other aspects will need to remain in place. These are just a few examples of selected types of work.

business consulting
Setting up an at-home business has both pros and cons

What advantages do entrepreneurs have when setting up businesses at home?

On one hand, overheads such as office rent and transportation are eliminated when you start a business at home. As entrepreneurs go from a one- or two-person operation to a larger team, Singapore’s multitude of co-working spaces and hot-desking options helps ensure that start-up costs remain manageable. On the other hand, having a permanent office address puts prospective clients, particularly those with traditional mindsets, at ease.

Can more digitalisation help eliminate the need for that?

The Singapore government has long made a commitment to digitalisation and innovation as the hallmark of the country’s evolving economy. Everything from company registration documents to annual financial statements can now be uploaded remotely. Important documents can be stored on the cloud. People are now getting used to the idea of virtual meetings rather than face-to-face ones. We are at the peak of digital transformation. With the government’s backing, we might be able to create technological solutions for all corporate needs.

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