Beyond the Fireworks: A Business Guide to Hong Kong Festival Success
Learn how retailers can leverage Hong Kong's vibrant festival calendar and public holidays to drive sales. Discover key strategies for seasonal success.
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As one of the fastest-growing economies in the Asia-Pacific region, Singapore is a highly attractive market for online marketers and sellers worldwide. Connecting with the Asian as well as global markets, Singapore is an ideal choice for you to expand your international customer pool and build your e-commerce empire.
For those who are hoping to sell online in Singapore, it’s essential to first get a grasp on the e-commerce landscape in the city-state.
In this article, Choco Up compiles key facts, statistics, tips and a list of top marketplaces where you can get started with your e-commerce business and start selling online in Singapore.
With numerous tools, marketplaces and business partners available, it doesn’t take a genius to start an online business in Singapore.
But before you can start selling online in Singapore, key facts and statistics about the city-state are what you need to know. So here they are.
Market intelligence shows that Singapore has over 3 million e-commerce users. Given that the city-state only has a population of roughly 5.8 million, this figure is pretty impressive.
That being said, it should come as no surprise that the Lion City has a high e-commerce penetration rate, for the city-state is known for having a tech-savvy population.
In fact, Singapore has an Internet and smartphone penetration rate of 98% and 93% respectively, making it an ideal breeding ground for launching an online business.
As for the languages spoken, government statistics show that English is the most frequently used language by around half (48.3%) of the city-state’s population.
Trailing behind English as the second-most popular language is Mandarin (29.9%), with Malay (9.2%) being the third-most commonly common language in Singapore. Other languages used include Chinese dialects, Tamil and more.
According to Statista, revenue generated by the e-commerce sector in Singapore is estimated at US$7.29 billion in 2022. The market is projected to grow at a CAGR of 16.23% (2022-2025), making a forecasted market size of US$11.45 billion by 2025.
Among all categories of products bought online, fashion accounts for the largest portion of sales in the e-commerce industry in Singapore.
The same Statista source shows that revenue brought about by fashion items stands at US$1.9 billion in 2022, followed by electronics (US$1.8 billion) and furniture (US$1.06 billion).
With nearly two-thirds (65%) of e-commerce transactions completed with debit or credit cards, cards are no doubt the most popular payment method used by online shoppers in Singapore. The next most commonly used payment option is digital wallets, which is used to pay for 18% of purchases online.
Noteworthily, a J.P. Morgan report forecasts that the divide between different payment options will be narrowed soon in 2023. The dominance of cards is expected to take a sharp fall to 47%, whereas digital wallets will rise to account for 26% of e-commerce purchases.
Selling online in Singapore can be tricky, as there are laws, taxes and duties that you should be aware of as an e-tailer.
This section therefore walks you through some practicalities and regulations before you start selling online in Singapore. Let’s take a look at what they are.
The Sale of Goods Act, or SOGA, consolidates the law in relation to the sale of goods in Singapore. It applies to all contracts for goods sold in Singapore, and should be abided by any online seller thereby.
Some noteworthy provisions in the Sale of Goods Act are sections 13 and 14, which stipulate that any goods supplied by a seller should be fit for purpose, of satisfactory quality, and in line with the product description.
Violation of the law in this respect would entitle shoppers to terminate a contract of sale or to claim damages (i.e. money compensation). You can check the Misrepresentation Act to acquire a fuller understanding of your responsibilities under the Singaporean law.
The short answer is no, you don’t need a license to sell your products online in Singapore.
However, providers of broadcasting services or computer online services are required to obtain a license from the Singapore Broadcasting Authority (SBA).
Online shops dealing with secondhand goods likewise need to secure a license from the Deputy Commissioner of Police, according to the Secondhand Goods Dealers Act.
The Inland Revenue Authority of Singapore (IRAS) provides guidelines on the major categories of duties and taxes that are applicable to imported goods. This section explains the types of taxes and duties applied in Singapore.
Customs duties don’t always apply to imported goods with Singapore's free-port operation. Yet, specific items are liable for customs duty, such as beers that exceed 5.8% ABV.
Excise duties “penalize” certain goods to discourage the consumption of items which may be potentially hazardous for consumers and the environment.
Items subject to excise duties include liquors, tobacco products, petroleum products, biodiesel blends and more. For online sellers seeking to import these goods into Singapore, duties are part of the costs of goods sold (COGS) that you must be aware of.
The full list of dutiable goods can be found here.
The Goods and Services Tax (GST), which is currently set at 8%, applies to all goods imported into Singapore.
GST in Singapore is computed based on (a) the customs value of goods, or (b) the last selling price (if there has been more than one sale) plus duties.
GST = (Customs value or last selling price + Duties) x 8%
50 boxes of dietary supplements are bought by Company ABC at S$600 on Free on Board (FOB) incoterms. The costs of freight, insurance and handling total S$70. Before the goods arrive in Singapore, the goods are sold by Company ABC to Company XYZ for S$1,000.
Since dietary supplements are non-dutiable goods, there’ll be no duties payable.
GST payable by Company XYZ
= Last selling price x 8%
= S$1,000 x 8%
= S$80
A motor vehicle is imported into Singapore by Company ABC. It was bought at S$70,000 on Free on Board incoterms. The costs of freight, insurance and handling total S$700.
In the following calculation, excise duty is assumed to be 20% of the customs value.
Step #1. To calculate the GST payable, we must first compute the customs value and duties payable on the vehicle:
Customs value of the vehicle = S$70,000 + $700 = $70,700
Duties payable on the vehicle = S$70,700 x 20% = S$14,140
Step #2. Then we can calculate the GST payable using the above-mentioned formula:
GST payable by Company ABC
= (Customs value + Duties) x 8%
= (S$70,700 + 14,140) x %
= S$6,787.2
Certain goods and items are considered “taboo” by the Singapore customs and hence prohibited from being imported into Singapore.
Prohibited goods include endangered wildlife or products derived from them, military communications equipment, firecrackers, obscene media products, chewing gum, nasal or oral snuff, and shisa.
The full list of controlled and prohibited goods can be found here.
Now that you’ve learnt of the facts about Singapore and some legal considerations, it’s time to get down to the practicalities — where will you promote or sell your products?
Many e-tailers choose to sell on marketplaces for the ease and convenience of doing so, and Choco Up has rounded up a list of 8 top e-commerce marketplaces in Singapore for your reference.
Top platforms for selling online in Singapore:
Launched back in 1994, Amazon polished its international presence and launched their domain for Singapore in 2019, attracting significant website traffic and online transactions. With more than 4.8 million visitors per month, Amazon.sg presents lucrative opportunities for digital merchants who want to tap into Singapore’s e-commerce market.
Selling on Amazon.sg is easy and involves only a few simple steps. Just create an account and submit your identity proof and other required documents, and you’ll be able to sell on the marketplace after the review process is completed.
To actually sell with Amazon in Singapore, you’ll have to prepare a monthly subscription fee of S$1 per item sold for an individual plan, or S$29.95 per month for a professional plan.
Additional fees may knock on your door as well. An example is when you use Fulfillment by Amazon (FBA) to pick and ship orders, and provide customer support for your business.
Learn more: Is Amazon FBA Worth It In 2022? The Answer Will Surprise You.
Established in 2012 and headquartered in Singapore, Carousell is an online marketplace with a sharp focus on recommerce.
As of 2019, the Carousell app has accumulated more than 2.8 million downloads in Singapore, that is, half of the city-state’s population have the recommerce app installed on their mobile devices.
To offer your vintage goods to buyers through Carousell, simply create an account, snap a photo of your items, fill out some product information and you’re good to go for selling on the marketplace.
Each seller can post up to 30 active listings, and transact at no cost with buyers on the platform. For an increased quota of listings, you can apply for one of their CarouBiz (Carousell for Business) plans, which start at S$9.98 per month.
eBay is a longstanding online marketplace and auction platform with over two decades of online selling expertise. As the company itself advertises, you can sell “practically anything” from clothing and accessories to electronics and collectibles on the platform.
Despite having its roots in the West, eBay is currently one of the top 10 e-commerce sites in Singapore. Boasting 300,000+ monthly traffic in Singapore, it also has an international reach and connection with global customers.
Both registration and verification are required for one to sell on eBay in Singapore. In the verification process, your identity, payout account details for payouts, and business details (if applicable) are items that will be checked off the list.
Once your account has been verified, you can start selling on the auction platform.
Unlike most other e-commerce sites in the region, eBay Singapore doesn’t charge any listing or commission fees. However, you may need to pay a final value or commission fee if you successfully sell your items on other regions’ paysites, such as eBay in the US or UK.
Founded in 2012, Lazada has been serving the Singaporean market since 2014 and enjoys the privilege of high website visitor volumes (7 million visitors per month in Singapore). Outside of its home market, Lazada also covers regions like Indonesia, Malaysia, Thailand, the Philippines and Vietnam.
Anyone who is physically based in Singapore can register to become a seller on Lazada Marketplace. Seller tools, online training and courses are offered to help merchants navigate the e-commerce journey and boost their online sales.
On the other hand, LazMall is a curated selling channel available only to approved brands and businesses. Once you’re approved for the LazMall, you’ll gain access to exclusive privileges, such as higher search rankings on the site, participation in Lazada’s campaigns and promotions, advanced seller tools and more.
For marketplace sellers, commission fees are set at a fixed rate of 2% on each successfully delivered order. LazMall merchants are subject to commission fees of 3% to 5% on the transaction amount, depending on the category of products sold.
RedMart is an online supermarket with an emphasis on grocery products and daily necessities. Acquired by Lazada in 2016, RedMart now operates exclusively on Lazada’s platform, serving Singaporean consumers with 120,000+ products.
To become a RedMart seller, you must first be able to meet their eligibility requirements, which include 7-day warehouse availability or fulfillment, having a team dedicated to running your e-commerce business, as well as compliance with retail guidelines of the Singapore Food Agency (SFA).
No commission fee is charged for selling through RedMart. The platform would instead buy the products from you at a wholesale or an otherwise agreed-upon price.
With close to 15 million monthly web visits, a figure double that of Lazada, Shopee is hands down the most popular e-commerce site in Singapore.
Anyone based in Singapore can sign up and start selling on Shopee Marketplace in a few simple steps. You’ll then gain access to Shopee’s network of logistics partners, marketing tools and sales analytics dashboards.
If you already have an established e-commerce business and are looking for more sophisticated marketing tools or premium status on the marketplace, Shopee Mall may be a better option for you. Similar to LazMall, Shopee Mall is a retail space reserved for trusted manufacturers, distributors and brand owners.
Commission fee is waived for marketplace sellers the first 90 days. A 2% commission will be charged on each successful order afterwards.
Since Shopee Mall merchants enjoy premium status and advanced tools from the platform, a higher cut is taken from them. Commission fees range between 3% and 5% of product prices. The exact rate varies from category to category.
Qoo10, previously known as Gmarket, is an online marketplace in Singapore that offers a wide array of products ranging from daily essentials to automobile accessories at affordable prices.
To enjoy the services of Qoo10 as a seller, you should first create an account on their site. You can either register as an individual or a business, but your real (business) name must be used.
A one-time registration fee is charged upon signing up. The amount is 10,000 Q cash, which is equivalent to S$100.
There is no listing fee at Qoo10, but you’ll be charged a “service fee” on all transactions made on the platform. Depending on your account type, the fee is up to 12% of the total transaction amount, which is quite high compared to that of other marketplaces.
This leading online fashion shopping platform started its service in Singapore in 2012. If you wish to sell fashion items online, Zalora is the choice for you.
With Zalora, you can get your own online storefront and set the prices for your goods, so it’s basically like renting a shop space in a virtual mall.
To kickstart the registration process, you’ll have to submit an online form with Zalora. You’ll then have to wait for up to 7 days for your application to be reviewed and approved, after which you can set up your store design, product listings and start selling.
Zalora doesn’t charge a monthly subscription fee for setting up an online storefront on its site. It does, however, take commission of 10% to 30% depending on the type of items sold.
Extra and hidden fees are something to pay attention to though. They may pop up when you decide to list multiple photos for a single listing, or when customers return your goods.
If you plan to extend your product outreach and brand influence by joining Singapore’s growing e-commerce industry, then the trends, rules and interesting platforms listed above may help you strategize your online selling.
But if you’re looking for more resources and insights for running an e-commerce business, then Choco Up can help!
As a global technology and financial services platform, we not only offer revenue-based financing — a type of flexible, zero-equity funding — for digital merchants and startups. We also provide a wide array of how-to articles and business growth solutions for our clients.
Whether you’re just starting out or trying to grow an e-commerce business, Choco Up can always be your trusted funding and growth partner. You can learn more about our funding here.
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Learn how retailers can leverage Hong Kong's vibrant festival calendar and public holidays to drive sales. Discover key strategies for seasonal success.
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