Starting a Business in Singapore and the Entrepass

[oldisgold]

I have read all official info about getting EP (forums, site of agencies and etc), especially the documents that require Mom site. But still i dont have clear picture how the process look like that is why my main question was is it worth to use agencies help or not. Because we have biz plan and all another support documects showing backgrounds and professionalism, having more then enough money for start up. And i just dont know how to use it the best way....
If there is someone who did get EP by themself, and ready to give this info for free ( couse agencies charge like 500$ per hour consultation) then it would be just great help. My case is not typical because i dont have High Education degree, thats why i want everything to be perfect to have higher chances for approve.


Thank you.

It is not worth the money to use an agency. First of all, the most they will know about your business is what you tell them. They are stupid otherwise. The only thing you _might_ find an agency useful for is to create a professional finished product for submission. But, once done, they are going to put the application in the mail or drop it in the box by the front door of MOM. They do not have any special ability to push your application though MOM, and in fact, if MOM thinks you used an agency, they may well decide you are trying to pull one over on them.

If you investigate the agencies, find out exactly what they are going to provide for the money they will charge. Ask to see copies of the documents they will prepare for submission.

For you to start up your own business, you will have to do the following:

a) Find a "normally resident" person in Singapore who has a Singpass and is willing to be your director.

b) This person forms a private limited at IRAS with her/him as a managing director and you as a shareholder ($2).

c) You prepare your application for EP that your director will submit to MOM. It is very important that you do not submit your EP application online as you will not have a chance to submit supporting documentation with it. Submit the EP application for you manually.

d) In addition to the EP application form, you will want to submit the following:

1) A business plan of not more than ten pages which:
- shows your marketing and sales plan
- shows where you are going to set up your business and why it is the right place.
- identifies your competition and how you will deal with it
- shows how you are qualified to successfully run this company
- provides 3 years of pro forma financial statements that shows how your company will start and grow to profitability
- provides a concise resume of your skills and background
- Provides evidence of money in the bank via statements or other documentation

All of this information, plus a cover letter is submitted by your director along with your EP application, manually. Be prepared to have additional questions asked, and if your EP is rejected, your director must be ready to appeal... for example, by changing projections, sales, marketing... something that makes your company and you more desirable.

I'll say it again... this entire exercise is to prove to MOM that you're not somebody trying to scam the system by getting an EP from a bogus business.

If you want to use an agency, ask they what they will want from you in order to submit your application. If they don't ask for all of the above and more, they are handing you a line of crap.

I really appreciate your response and no doubt it is invaluable. I have a small question - I am a foreigner with no business experience but I plan to buy an existing business in Singapore, not decided what type (couple of business in my mind such as restaurant, coffee shop, franchise store etc.). I also have a local investor (Singaporean) who will be investing in the business and setup the company. In terms of capital,I have more than what is required for the entrepass (though it requires a new business setup, correct me if I am wrong). Would it be possible to follow the process as you mentioned in your post?

[Strong Eagle]

A restaurant, coffee shop, etc will no longer qualify for an Entrepass. In order to qualify for an Entrepass your proposed company must hold intellectual property, or, be an incubator company at STAR, or have the backing of a major recognized venture capitalist. You wouldn't want to go Entrepass anyway as the rules for retaining the pass are also onerous.

This means you will have to go the route of forming a company, then applying for an EP for yourself as I have described in other threads. Whether or not you are successful is another question and one I cannot answer with any certainty.

The downside to your application is that you have no business experience. As I have stated in other threads, when I arrived in Singapore in 2004, and for the next couple of years onward, it seemed like there were all sorts of scammers taking advantage of lax vetting of new company applications, and people with no money and no experience managed to scam their way into getting a work/residence permit in Singapore.

On the plus side, you have plenty of cash. On the plus side, you also have a local Singaporean investor who can also set up the company, be the managing director, and apply for your EP. So maybe it will fly.

A question worth asking: Are you planning to actively manage the business? If not, why do you need an EP, why not just a shareholder? And if you are planning to actively manage the business, then what will you be doing? If you actually have something valuable to contribute (besides money) then you must accurately describe why you are needed to make the business go.

[oldisgold]

A restaurant, coffee shop, etc will no longer qualify for an Entrepass. In order to qualify for an Entrepass your proposed company must hold intellectual property, or, be an incubator company at STAR, or have the backing of a major recognized venture capitalist. You wouldn't want to go Entrepass anyway as the rules for retaining the pass are also onerous.

This means you will have to go the route of forming a company, then applying for an EP for yourself as I have described in other threads. Whether or not you are successful is another question and one I cannot answer with any certainty.

The downside to your application is that you have no business experience. As I have stated in other threads, when I arrived in Singapore in 2004, and for the next couple of years onward, it seemed like there were all sorts of scammers taking advantage of lax vetting of new company applications, and people with no money and no experience managed to scam their way into getting a work/residence permit in Singapore.

On the plus side, you have plenty of cash. On the plus side, you also have a local Singaporean investor who can also set up the company, be the managing director, and apply for your EP. So maybe it will fly.

A question worth asking: Are you planning to actively manage the business? If not, why do you need an EP, why not just a shareholder? And if you are planning to actively manage the business, then what will you be doing? If you actually have something valuable to contribute (besides money) then you must accurately describe why you are needed to make the business go.

I would be actively managing the company and the Singaporean investor would be a shareholder. I want to get involved in the business full-time and also want to relocate my kids for studies. Moreover the local investor is also my relative(nephew), do you think that would make any difference (negative or positive)?




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[sundaymorningstaple]

Negative if they figure out the only reason for this whole thing is to get your kids into the local school system.

[oldisgold]

Negative if they figure out the only reason for this whole thing is to get your kids into the local school system.

It would not be easy for the kids to go to the local school as what I have heard it is not an easy task to get admission. So probably they would go to International School

[Strong Eagle]

I would be actively managing the company and the Singaporean investor would be a shareholder. I want to get involved in the business full-time and also want to relocate my kids for studies. Moreover the local investor is also my relative(nephew), do you think that would make any difference (negative or positive)?

I judge that two primary factors will be weighed in making a determination. In your favor is cash... you are willing to put your money where your mouth is.

Since you are buying an existing business, you'd want to provide due diligence and a financial analysis of the business to demonstrate the investment viability... hell, I'd do that anyway

Against you is your lack of business experience, especially in the food service sector. Many people have tried and gone broke trying to run a food service business. It's a delicate combination of cost control, menus and service, and location.

Assuming you are buying a profitable business, you're going to want to demonstrate some kind of business acumen by focusing on what you are going to do to increase foot traffic and customers... advertising, better service, expanded menu... I don't know... and you get my point... have a plan that demonstrates you know what you are doing.

If you are going to be in the restaurant business, there are are about 2 million hurdles to jump to get properly permitted. An acquaintance of mine bought a restaurant for the purposes of remodeling and rebranding. Permit delays and approvals nearly cost him his investment it took so long to get things done. So, demonstrate your expertise by having a realistic perspective of what you will have to do, regulations wise, to be operational.

[j_burt]

I have recently relocated to Singapore and am currently on a dependent's pass. I am keen to set up a sole proprietorship whilst here. This would cease when I leave Singapore. I have been looking through all the helpful guidance on this site. Please could someone advise me what 6 pieces of information I need to take to the MOM? I can't seem to find the detail behind this comment. Also, can a letter of consent be printed off and completed or does this have to be completed online? The MOM site is down at the moment possibly because of the time of day.

Any help gratefully appreciated.

[sgquestions]

Hi, an update about my situation,
after providing a very detailed business plan (10 pages) with financial projection and business strategies, my own salary was put at 7,500, with MBA degree and such, my appeal case got rejected.

"You have not provided satisfactory information to show that your company's turnover generates enough revenue to pay your employees' salaries and business expenses."

I suppose what they mean is signed contracts and deposit of checks. which are not feasible at current situation, that no one is hired in the newly setup company and therefore no case and no income.

but I guess MOM they don't care about the situation (why should them). they only care about facts so that they can tick tick then grant or reject.


[quote="Strong Eagle"]Question: What is your current residence permit status?

[Strong Eagle]

"You have not provided satisfactory information to show that your company's turnover generates enough revenue to pay your employees' salaries and business expenses."

Did you business plan include pro forma financial statements showing revenue growth sufficient to support your stated salary?

Did you include evidence of sufficient cash to support yourself at the stated salary through proposed break even and profitability point as shown in your pro forma statements?

[j_burt]

The fixed salary question refers to monthly salary, not annual. In my opinion, a monthly salary of $7,500 after direct expenses and other employee wages would be good going for a new business.

I have been advised that you can go back to the MOM. No doesn't necessarily always mean no.

Good luck.

[j_burt]

Do you need to show that you don't need to draw much of a guaranteed fixed salary from the business in the early days. If they think you have high personal outgoing could they think that other employees or suppliers will be the ones not to get paid if the business didn't perform quite as well early on?

Just throwing it out there.

[Strong Eagle]

The fixed salary question refers to monthly salary, not annual. In my opinion, a monthly salary of $7,500 after direct expenses and other employee wages would be good going for a new business.

I have been advised that you can go back to the MOM. No doesn't necessarily always mean no.

Good luck.

Business plans used to be vetted by Spring and I'd bet money they still provide this service for MoM.

If you're going to pay yourself $7,500 per month, you'd better identify the source of the cash, be it an investment in your company or anticipated sales revenue. You'd better do the same for expenses as well.

Stating that you will get paid $xxx in salary without sourcing it just about guarantees rejection. So, too, does unrealistic projections in your plan and pro formas. If you're going to do IT tech work at $200 per hour while the going rate is $50, kiss your application goodbye unless you've got a strong narrative that supports a far higher rate than the standard.

Similarly, if you're projecting wild growth, huge market penetration, and profit margins well above the norm, you'd better be able to support it with a marketing plan and a budget or you'll be viewed as an amateur that has no idea what is going on.

You can't just make up numbers, salary or otherwise. Where did the $7,500 number come from? Is it what you need to live on? Is it a realistic number based on your growing revenues and expenses? Is your bill rate and number of hours sufficient to support it?

Signed contracts or a client on the line is always a great thing but coherent financials are equally important.

[Tatsu]

I'm an American married to an Indonesian and we'd like to stay in
Asia, preferably Singapore. I've had 3 businesses in Indonesia, two of
which are still going but the pollution there makes me want to get out
forever. I tried to apply for work in Singapore so that I could get
permanent residency status in 3 or 4 years but I haven't been
successful to have applications from businesses that want to hire me
approved by the Ministry of Manpower. I don't seem to have
satisfactory qualifications.

Though it doesn't provide me with permanent residency status, I have
a several hundred thousand to play with for investing in some kind of business
that would give immigration a reason to allow me into Singapore. But I
prefer something that allows me to bring my wife and daughter to stay
long term as with the Long Term Visit Pass for Entrepreneurs but I
don't know if that will include my family. Maybe you know who I should
ask or another, better way to do this. Anyway, I'm currently looking
at warehouses/storage businesses, and franchises like 7-11, a Subway
Sandwich shop, or a pawn shop.

[ecureilx]

I'm an American married to an Indonesian and we'd like to stay in
Asia, preferably Singapore. I've had 3 businesses in Indonesia, two of
which are still going but the pollution there makes me want to get out
forever. I tried to apply for work in Singapore so that I could get
permanent residency status in 3 or 4 years but I haven't been
successful to have applications from businesses that want to hire me
approved by the Ministry of Manpower. I don't seem to have
satisfactory qualifications.

Though it doesn't provide me with permanent residency status, I have
a several hundred thousand to play with for investing in some kind of business
that would give immigration a reason to allow me into Singapore. But I
prefer something that allows me to bring my wife and daughter to stay
long term as with the Long Term Visit Pass for Entrepreneurs but I
don't know if that will include my family. Maybe you know who I should
ask or another, better way to do this. Anyway, I'm currently looking
at warehouses/storage businesses, and franchises like 7-11, a Subway
Sandwich shop, or a pawn shop.

Would you be able to add a couple of zeros ? To the hundreds of thousands ?

[Tatsu]

I could, but I'm not going to and don't need to.