COVID-19 has unveiled an entirely fresh perspective on starting a business today. Although the effect of the pandemic seems to be long-lasting, the world is expected to return on track swiftly.
However, Hong Kong witnessed a slow growth in 2021 compared to previous years, but the business opportunities are mushrooming at an impressive rate.
Meanwhile, many individuals seek opportunities to start a business in 2022 and struggle to make a mark amid COVID-19.
Supporting mid-size businesses and making room for economic development and employment is the primary aim of the Hong Kong finance department for 2022.
Given this, how to start a profitable small business in Hong Kong in 2022?
The blog is a step-wise step formulation of how to start a small business in Hong Kong in 2022.
The reasons for business failure in Hong Kong are:
No proper business plans
Failure to understand business concepts
Ignoring potential aspects of data
Not understanding the trends and marketplace
Given this, how to start the most profitable business without failing?
Here is how you can!
1) Understand the legal requirements of a small business in Hong Kong
Understanding the legal requirements of a business in Hong Kong is imperative for registering a business in the country. While doing so, be mindful of the type of legal business structure to choose:
Sole trader ( 1 owner)
Partnership ( where two or more people are involved in costs and risk undertakings) and you can find business partners to do a partnership through the Business Co-founder app.
Limited company
Analyze the license requirements for starting your business in Hong Kong.
Moreover, for protecting a business against risks, some insurance policies are legally required:
Primary insurance covers to consider:
Employment protection covers
Cyber covers
Business interruption
Public liability covers
Professional indemnity covers
2) Test your business Idea
Maximum individuals start up a business without delving deep into the potential and loopholes of the business and thus end up shutting it down.
Before kick-starting your business, identify:
Whether your business idea is viable?
Who is your target audience?
What existing problem do you solve?
How do you differ from your competitors? What is Your Unique Selling Feature?
To identify these, you can conduct a SWOT analysis:
STRENGTHS: Things that position your firm on the top
WEAKNESS: Things that your company lacks, or your competitors, have the edge over
OPPORTUNITIES: The emerging need for your products and services in the market
THREATS: Shifting consumer behaviors
Test your potential customers by launching webinars, surveys, or questionnaires to understand:
Who are the actual buyers of your product?
How much are they willing to pay?
Your competitor’s image in customer’s eyes
What potential problems does your business face?
3) Craft a Business Plan
A business plan outlines the initiatives to take when and how to implement them most profitably.
Your business plan should include the below parameters:
Summary: an overview of your business- aims, story, and procedure to achieve it.
Business idea: what do you plan to offer, who is your audience, and why your idea will be a success?
Marketing strategy: details on competitors, pricing, distribution, and marketing tactics
Operations: business location details, production, and IT support
Financial Projection: cash flows, balance sheets, income and revenue details, capital needed, the collateral you can offer
4) Secured Finances
After outlining your business idea and walking past the terms and conditions for starting a business in Hong Kong, the most important thing to analyze is-
“How much capital do you require to start your business in Hong Kong?”
Are you going to dissolve all your savings?
Or
Seek a loan for bad credit with no guarantor?
If you fail to rationalize any of the above ideas, you can contact a direct lender. Why?
Benefits of hiring a direct lender for your business
High liquidity premium
More upside potential
Low volatility
Greater diversification
On the flip side, direct lending may cost if you fail to:
Manage the fund leverage
Establishing a strong source pipeline
Complete the due diligence
Secure the investment
Analyze every aspect of a business loan before applying for the same.
5) Branding your business
What first strikes your mind when you think about your business?
How do you want your customer to think about your brand?
Branding is an important part of making your business known to your customers online. Thus, it is imperative to position your brand’s message in the most impactful manner that it:
Relates well with a problem or a desire
Creates a belief
Invites a TESTED- Solution
In this, focus on KEY drivers: Logo and company Name
How to decide on the right business name?
Analyze whether it aligns with customer problems and business goals
Is it comprehensible?
Is it easy to memorize?
To talk about logos, a logo is the primary business identifier and the face of the firm. Hence, it should be catchy, smart, and fulfill a purpose. It should send across a powerful message backed by a dynamic story.
6) Abide by Tax guidelines
Running a business comes with multiple business obligations, and taxation requires undivided attention.
Before that, you need to understand the business type and registration rules:
Sole traders:
submit a tax annual return fee
Limited firms:
Register with Company House
Pay corporation tax on profits
File a company tax return
Pay VAT
Most Successful Small Businesses To start in Hong Kong in 2022:
Coffee shops
Couriers
Car washes
Landscaping
Food delivery Outlets
Internet-based companies
Accountant firms
Thus, test your business against major business failures and ensure a strong technological backing to thrive in a cut-throat business environment.
This is how you can start your small business swiftly in Hong Kong in 2022. To help make the process smooth and obtain a business loan in Hong Kong, it is advisable to seek legal advice
