Setting Up A Design Practice

Published Date: 02 Nov 2017

1. INTRODUCTION

Setting up company is not that easy and simple. When we decide to start up a business, we need to consider various of things. Everyone does not want to take risk so there has a business plan. Business plan is

1.1 Objectives

The aim of my research is to analyze open new business. As well method of how to open up the business.

2. METHODOLOGY

My research begins....

3.1 Setting Up a Design Practice : Business Plan

A business plan is a tool which helps entrepreneurs to plan their businesses. It is a written summary that describes important aspects of the business. The nature of the business plan will be determined by the purpose for which it is needed. Persons seeking funding will require a formal business plan.(gov.vc)

Good business planning strategies involve more than simply wiring up a business plan. Before you write a business plan that you should know why business need a plan. First reason is that knowing exactly what your business intends to do so your ideas is clear to help determine your staffing needs, equipment needs and a role in the business structure you decide to organize.

Secondly, providing an outline of necessary paperwork to file which is very important in a way that depends on you are prepared or not it causes your business can be successful in my opinion. You will be able to determine if you need to file for any trademarks, licenses, copyrights or permits.

Lastly, to provide information to investors and banks to help gain starting capital. Banks and investors want to have proof that you have a good business items and how it will be marketed. So, they can help you to given better ideas and give a hand to start up your business. (brighthub.com)

A business plan outline need to follow some structure;

Your business name: Title is always give a first impression. Consider how it fits well, it becomes your business brand and market. If it could already be in use by another company, legal assistance might help to obtained to ensure find another business name.

Vision: What is the future of your business is a way to have a goals and objectives to be for your employees or for after 5 years. How much you have dreamt make different future of your business.

Branding Ideas: Think about how you will be able to take your business image to tell or promote your business to other companies or clients. Consider this deeply as this will be what develops into your business logo and slogan for your business card and other marketing materials as the business grows.

Mission Statement: This is a speaker of your business' specialist other than similar of your competitors. It tells you about who you are and what you do.

Market Research: Research your competitors to get information whether there is a viable market in your area for your product. This will help you determine if you should revise your business idea slightly to differentiate yourself from competitors and will help set your pricing structure.

A Financial Plan: how much money you are going to need in preserves if business does not turn out the way you anticipate, and give you a better grasp of how to go about securing capital.

A Detailed Plan of Action: Include what you are going to do for sales and marketing, what you will do in the event the business starts to falter, how you are going to expand your business in times of prosperity, etc. Having a plan for what to do in the event something doesn't happen the way you hope it will is one of the best things you can do to help your business succeed. (businessdictionary.com)

1. Small, Medium, Large Enterprises

Small firms showed to have differences advance to training, recruitment and work organization than medium or larger firms. Small firms liked to give partiality to outer applicants in filling situations and were less likely to use formal enrollment methods or to use presentation or personality tests in filling vacancies. SMEs showed a lower predisposition to provide formal off-the-job training than large firms, but employees took a similar amount to that provided by larger firms, where this was available. It was also the case 42 Small and Medium-sized companies that employees of SMEs were less likely to feel displeased with the training that they had received and were more likely to powerfully agree that managers encouraged employees to develop their skills. In conditions of work organization, there was little evidence that the use of team-working within workplaces wide-ranging greatly with firm size, but SMEs made less use of problem-solving groups or suggestion schemes than large firms. They were also less likely to carry out evaluations or to provide training on practical flexibility, although employees of small firms were more likely to be functional flexible in perform than employees who worked for larger firms. Working patterns depicted to be rather different in SMEs in that there was less use of shifts, zero hours and annual hours contracts, while the employment of part-time workers was common. There was some data of greater workforce strength in small firms, both based on management and employee reports, although SMEs did make greater use of fixed-period and temporary contracts and freelancers. They were also less likely to use agency workers or subcontractors to supplement their own employees. Besides the fact that employees were more likely to feel that their job was secure in SMEs, it was also notable that they reported greater job influence and independence and expressed greater satisfaction with their work, and with the organization that they worked for, than the employees of large firms.

2 Small, Medium, Large - Manufacturing System

Flexible Manufacturing

A number of computer Numerical Control(NC) computers controls equipments in flexible manufacturing. The production relies more on robotic cells than manufacturing personal which allows the business owner to change the products manufactured to react to customer or market needs. The use of automation produces a product that is manufactured to precise specifications which in turn produces improves the quality of the product.

Disadvantage - high initial cost of the manufacturing equipment

Intermittent Manufacturing

Intermittent Manufacturing is one of method for a small company. Using items what are alike with nature, however it has variations which are for this manufacturing such as color, sizes, etc. 'For example, there has a bicycles that want to sell tires which have different sizes to suit a variety of bicycle wheels.'(logistic.about.com) Depending on manufacture batches can be same in demand on what product is going to be manufactured. This method is good for irregular user of products.

Custom manufacturing

It is common manufacturing type for small enterprises because most of small businesses have 'custom' designed products to business direct to consumers. This kind of method requires high quality of skill is needed. Also complexity is as well. Normally, owners work directly from small business therefore, often use custom manufacturing in specialize goods.

Summarize

Customers across the world use that large numbers of small enterprises manufacture products. It does not mean to be only to large companies.

Small companies can be more successful than larger enterprises when they offer good with niche products where has less competitors. There has an important thing that small companies' owner should remember that they do not need to know single of aspect running a business and can use professional services such as marketing, accounting and technology companies to take a better advantage from competitors.

3. Commerce, Service, Non physical items based products

3.2 Legalities

Small Business Set Up : Legalities

A business firm is either a sole-proprietorship or a partnership. Individuals and companies, being "legal persons", may set up and own a business firm.

Individuals and companies registering business firms need not be Singaporeans or incorporated in Singapore.

The manager of a business firm must be: a Singaporean, Singapore Permanent Resident, Singapore Employment Pass Holder or Dependant's Pass Holder.

Structure of business entities; sole-proprietorship, partnership, company

Sole-Proprietorship

A sole-proprietorship is a business owned by one person or one locally incorporated company. It is the simplest and most flexible business structure. A sole-proprietor has unlimited liability.

Set Up Cost

Fees for approval of business name : S$15 per name

Registration fees : S$50

Yearly renewal fees:S$20

Advantages

*Quick and easy to set up - Many low-risk service businesses such as copywriters, small retailers, pet groomers and designers start off as sole-proprietorships

*Easy to administrate

Sole-proprietors do not need to audit their accounts or file annual returns with ACRA

* Easy to manage - The owner is the sole decision maker

*Exclusive use of profit

The owner receives all the business profits.

Disadvantages

* The owner bears all costs and risks

* The owner is personally accountable for debts and losses. The owner may be required by law to sell off personal assets (e.g house, car, shares, etc) to pay off debts and losses. You may want to avoid setting up as a sole-proprietor if your business involves big risks and possibly huge losses.

*Borrowing powers for sole-proprietors are more limited. To secure loans from banks and lending institutions, the owner must be prepared to put up his/her own personal assets as collateral.

*The owner cannot raise funds by selling a stake in the business to investors as sole-proprietorships can only be owned by a single, individual or company.

* As the business and owner are inseparable, the business may come to a standstill when the owner falls sick or dies.

Partnerships

General Partnership

Under the Business Registration Act, should be registered of partnership for a sole-proprietor. The partnership need at least two and cannot have more than twenty.

If the company have more than twenty partners, it is considered to register under the Companies Act. As general partnership is not a separate legal unit, members of the partnership are together and legally responsible for the debts of the partnership.(F.K.Tan p.14)

Set Up Costs

Fees for approval of business name : S$15 per name

Registration fees : S$50

Yearly renewal fees : S$20

Advantages

*Quick and easy Set Up - other than registering with ACRA, there are no other formalities required. However, it is advisable to draw up a Partnership Agreement with the help of a lawyer. The contract helps to define the role, responsibilities and profits due to each partner.

* Easy to administrate - Partnerships do not need to audit their accounts or file annual returns with ACRA

* More resources and sources of funds - Partners bring resources, experience and funds to the table. Banks and other lending institutions may also be more willing to lend based on the combined assets of all the partners.

Disadvantages

*All partners bears the costs and risks. As each partner has the implied power to act on behalf of the partnership, a partner can be made accountable for the loss caused by another partner.

* Partnerships are automatically dissolved when a partner exits or dies. The remaining partners will have to form a new partnership.

* Like sole-proprietorships, partners are personally accountable for busniess debts and losses. The partners may be required by law to sell off personal assets (e.g. house, car, shares, etc) to pay off debts and losses.

* Decisions relating to the partnership (e.g addition of new members, change in the nature of business) must be agreed by all partners.

Limited Liability Partnership(LLP)

LLP is Limited Liability Partnership that it combine the limited liability features of companies with the operational flexibility of partnerships. All LLPs must be registered with ACRA (Accounting and Corporate Regulatory Authority)

Set Up Costs

Fees for approval of LLP name : S$15 per name.

Registration fees: S$150

Yearly renewal fees: Not applicable.

Fees for conversion from a business or a company into an LLP: S$ 100

Advantages

*Limited Liability - The personal assets of the partners are protected. In addition, owners are not personally accountable for the wrongful acts of other owners. However, partners can be personally accountable for debts and losses resulting from their own carless actions.

* Perpetual succession - Any changes in the LLP (e.g resignation or death of partners) do not affect its existence, rights or liabilities.

* Easy to administrate - Like partnerships, there is no need to audit or file annual returns with ACRA. However, the appointed manger must make an Annual Declaration to ACRA stating whether the LLP is able to pay its debts as they become due in the normal course of business.

* More attractive to investors- investors may be more willing to join as silent partners as liability for partners is limited.

Company Incorporations

1. Private Company Limited by shares

Most companies in Singapore are private companies limited by shares and bear the suffix "Pte Ltd" or "Private Limited" to its name. A private company which wishes to maintain than 50 shareholders must be converted to a public company limited by shares.

2. Exempt Private Company (EPC)

An Exempt Private Company (EPC) is one with less than 20 individual shareholders and with no corporate shareholder. An EPC does not need it accounts to be audited if revenue is less than S$5 million for the financial year. However, professional firms filing on behalf of EPC may still require the hardcopy exempt certificates from directors as evidence of compliance and for record purposes.

3. Public Company limited by guarantee

A public company limited by guarantee is one which carries out non-profit making activities that have some basis of national or public interest, such as for promoting art, charity etc. There is no share capital.

4. Public Company limited by shares

A public company limited by shares is one where the number of shareholders can be more than 50. The company may raise capital by offering shares and debentures to the public. A public company must register a prospectus with the Monetary Authority of Singapore before making any public offer of shares and debetures.

5. Branch Office of Foreign Company

Foreign companies may conduct business in Singapore by establishing a branch office. Any foreign company wishing to register a branch has to engage a professional firm such as a corporate secretarial firm or a legal firm to assist in the application.

6. Representative office

A foreign companies may establish a representative office in Singapore to undertake promotional and liaison activities on behalf of its parent company. The office, however, directly or on behalf of its parent company, must not be engaged in business, conclude contracts, provide consultancy for a parent company, must not be engaged in business, conclude contracts, provide consultancy for a fee, undertake transshipment of goods, or open or negotiate any letter of credit.

Approval for the establishment of a representative office must be obtained from IE Singapore.

7. Operational Headquarters (HQ)

The Singapore Government encourages companies to use SIngapore as a base to conduct headquarters management activities to oversee, manage and control their regional and global operations and business. The HQ can be in the form of Regional Headquarters, International Headquarters, Operational Headquarters, Business Headquarters or Manufacturing Headquarters.

3.3 Intellectual Property

1. Copy Right

The Copyright Act provides that the owners of creative works such as literary works, dramatic works, musical works, artistic works, wound recordings, cinematographic films, television broadcasts, sound broadcasts, sound broadcasts, cable programmes and published editions of works enjoy a monopoly to (i) make a copy of the work, (ii) publish the work, (iii) perform or cause the work to be seen or heard in public, (iv) communicate the work to the public, (v) adapt the work and (vi) enter into a commercial rental arrangement relating to that work. Whether or not the full monopoly of (i) to (vi) applies depends on the type of work in question.

There is no requirement of formal registration - copyright is automatic and, subject to certain requirements, begins at the point of creation. The duration of copyright protection may be as the lifetime of the author and 70 years thereafter depending on the type of work. Depending on the type of infringement, a copyright owner can claim damages, an injunction and account of profits against infringers of that copyright.

Coca-Cola is a good example that it owns copyright in the design of its bottles, the design of its logos, its advertising, and generally anything it creates that can be considered an original work requiring creative effort. For example, the famous Coca-Cola logo and script design is an original artistic creation that is protected by copyright law. In other words, the right to copy the logos and script design is limited by copyright law.

2. Trade Marks

Registered trademarks are protected via the Trade Marks Act. For a trade mark to be registered, it must, amongst other requirement, be capable of graphical representation, distinctive, non-descriptive, non-generic and non-functional. A trade mark will be considered infringing if it is similar to an earlier registered trade mark it is to be registered for goods and services which are similar to those for which the earlier trade mark is protected and as a result there exists a like hood of confusion on the part of the public. Owners of trade marks that are well-known in Singapore have greater protection. Such marks are protected against confusing associations, dilution, garnishment and free-riding. Depending on the type of infringement, a registered trade mark owner can claim damages, an injunction and account of profits against infringers of that trade mark.

The Coca-Cola company holds registered trade-marks in its logo and script design. Even the distinctive shape of the Coke bottle is trade-marked. These things are trade-marks because they are distinctive marks used by the company to identify its goods and services as being uniquely Coca-Cola's.

3. Patents.

Patents are concerned with the protection of functional and technical inventions in the form of new products and processes. In Singapore, patent protection is governed by the Patents Act. Inventors can obtain patent protection for their inventions by registering their inventions with the Registry of Patents. The inventor's patent rights are not restricted as to nationality or residency so long as the parent is registered in Singapore. As most inventors are actually employees, the Patents Act provides that inventions made by employees in the course of their employment would be owned by the employer.

Patentable inventions must be new, inventive, and have industrial application. The requirements for patentability are very stringent, and the process to obtain patent protection is both difficult and costly relative to other intellectual property rights. A significant part of the difficulty lies in the need to establish that the invention is in fact "new" and the highly technical drafting of the patent documents. The patent specifications are the key to the validity of the patent and therefore, the application process would generally require the appointment of a registered patent agent who possesses the requisite skills of drafting patent specification. The relative difficulty in obtaining patent protection as compared to other IP rights is justified by the very strong monopoly granted by a patent.

The process for applying for a patent involves five main stages, namely (i) the filling of the application, (ii) the preliminary examination, (iii) the search and examination, (iv) the publication of the application and (v) the granting of the patent. The patent system in Singapore operates on a first-to-file basis.

Coca-Cola company creates various inventions to assist with its business. Many of these are patented, even the ones that are not particularly unique, since an invention does not have to be totally unprecedented to be patented; it just needs to have some element of novelty.

For example, the Coca-Cola company owns a patent on a method of making "barrier coated plastic containers." Obviously no one has the exclusive right to make plastic containers, but Coca-Cola has the exclusive right to use the particular method of making those containers that they describe in their patent.

4 Industrial Designs

A design refers to the features of shape, configuration, pattern or ornament applied to an article by an industrial process. An example of a design would be the shape and configuration of a fancy speaker system. Protection for the design created for industrial use can be sought under the Registered Designs Act ("RDA") by registration of the design with Registry of Designs. For a design to be registration of the design with Registry of Designs. For a design to be registrable, the main requirements are that the design must be new, it must be industrially applied and its features are not solely for a functional purpose. Once a design has been registered, the owner of the registered design can prevent others from using the same or similar design. If any other person uses the registered design without permission, the owner of the registered design may obtain damages or an account of profits, and an injunction against continued use.

The protection of industrial designs overlaps to an extent with other intellectual property rights like copyright as some industrial designs are also artistic works. In certain cases, the design may also be protected as a trade mark. Also, there are restrictions on copyright infringement actions for works registrable under the RDA. The disadvantage of protection under the RDA relative to other intellectual property rights is that the designs can only be protected for a maximum of 15 years.

3.4 Time Management

Time Management is scheduling to be saving time to do more work and budgeting one's time for improve productivity. It is important because it relates to money and energy. Depends on how control the time, it changes business economic and manpower activity.

As in manpower side, since you are focus on value projects you get more done during the day which means can get more result with various of result while that there have more choices to choose better one.

Being a lazy, make you delay your work time a day. Since the company has due date to get the file or project then you cannot leave the office before finish your job. At least being a organize time person, can go home early to spend time with family. Also it is fare to get monthly payment. It would be seems like more than you stay back every time. Less stress on running out of time if you have followed your own schedules. (lookingtobusiness.com)

As in company side, they would be happy if the manpower is well productivity because it makes the company get more clients and can finish earlier to make differences from other competitors. Less Time taken to make more products. On the other hand, if the business do over production then it is another way to spend money to store them. Therefore, good timing to finish and start are first thing what company is considered. That is why companies and small business use advanced time keeping software as well as personnel policies, to improve time management.

There have four sections you can divide : Quadrant of Necessity, Quadrant of Quality and personal leadership, Quadrant of Deception and Quadrant of Waste.

Quadrant of Necessity is "Important and Urgent" of your project that have to manage the best you can.

Quadrant of Quality and personal leadership is "Important but not Urgent" that try to focus on achieve goals faster.

Quadrant of Deception is "Not important but Urgent" which means to be careful because these achieves may appear urgent when in relation to your goals they are not.

Quadrant of Waste is "Not important and Not urgent". For this, you should avoid this project unless the more time you spend here the fewer goals you achieve.

3.5 Teamwork Skills

Generation of effective teams is dependent upon company's performance ethic

Every companies have 'team', there has no choice to choose team. Who is going to choose people is Human Resource; the other members that to choose employee to put in a team.

Human Resource Management (HRM) is an organisation that figure out on management of , recruitment of and giving direction for the people who need work in the team. HRM is also doing deals with people to hired, performed or development to be in a team. They look at your documents to figure out which team would need your ability. This is how the company find people but there are some problems. 'Team' might need an employee who had experience than his quality of education then HRM put a person who is totally different what team wants. In this case, the organization can be broken but sometimes less choice to be selected. This is why, the communication between HRM and other department is important. Consequently, some companies, they have two different interview for HRM and Department separately. (http://humanresources.about.com/od/glossaryh/f/hr_management.htm)

Once got a team then what is exactly means of team, that can be defined as a some numbers of people are gather together with different skills to purpose, approach and performance goal with taking responsibility own self to make a project. It requires mutual attention to be a good team.

Team success work

multi-functional involvement simultaneous full-time involvement communication co-location communication shared resources outside involvement

Team Leader

Build commitment/confidence

Keep purpose, goals/approach revevant/meaningful

Do real work

Create opportunities with outsiders.

Monitor timing/ schedules for planned activities

Strengthen the mix/ level of skills.

3.6 Budget Planning : Projected Profit/Loss

Business Plan cannot be complete without financial inferences of your strategies on your business. Yes, the business should consider in Start-Up Cost, Monthly Cost, and Annual Cost. To be Prepared of them is important because those are the one which is for predicting of Profit and Loss. (Brighthub.com)

Start-Up Cost

List down what or where you are going to spend for the business. For example, Deposit of your place and goods you need in the office, etc. Also, think about legal corporation cost such as LLC or a partnership for setting up.

Monthly Cost

How much is going to spend in monthly is one of questioning to yourself. It might be your employee's payment, PUB, Internet fees, insurance. Depends on your business have different things to be ready every month.

Annual Cost

Every year, you are going to check how much you have earned or lost. Also, there has an important thing that going to do is paying tax.

To know how much cost you are going to need in the bank for early months while your startup is inclining and not generating enough sales to cover costs and expenses. Some people say just for six months is enough to cover expenses. However, according to business people, as a first time to do business then need a year. (entrepreneur.com)

This might help your start up cost.

Fig.1- Chart of startup Capital

Invest

For your business, need funding agencies or potential investors. A combination of the promoter's equity funded business. There have two types of loans that short-term and Long-term loans. While starting up a new business itself, you are going to need additional funds over such as private equity investors, venture capital partners, Banks etc... They are going to help you but it also takes risk when your business is going down. Be wise to control income and outcome make your business faith.

From the above form, you can adjust how much cost you will spend. Also enjoy your suppliers while credit periods given.

An important point you will know is, because of high startup costs, for most start-ups the projected net profits in the initial periods will generally be in the losses. As long as the venture starts generating profits from the second or third year. Hence usually, potential investors and funding agencies look at the projections for three to five years at a glance. These two statements give a clear picture of the profitablility and financial health of the firm reasonably well.

- Basic of Taxation in Singapore (Import and Export tax system)

In Singapore, taxes are levied on income of companies, individuals and property. In addition, taxes are levied on use of property and consumption which are known as property tax and goods and services tax respectively. However, there is no capital gains tax.

For business in Singapore that have earning of SN$300,000.00 the tax is only 17%. Also, if your company is just starting up, you can enjoy a tax exemption of 100% of SN$ 100,000.00 and 50% of SN$ 200,000.00.

The conditions to qualify for the start-up exemption are that the company must be a Singapore incorporated resident company with no more than 20 shareholders and of which at least one is an individual shareholder beneficially and directly holding at 10% of the total number of issued ordinary shares.

Nowadays, many companies hire smarter accountancy to control paying taxes. Unless the profit will be lower than usual account. Of cause, try to be honest is good for the country but sometimes that is not the way to be survive in business area.

4. CONCLUSION