How To Start Business In Malaysia
Running our own business is tricky, let alone starting from scratch. But having a strategic and friendly environment can definitely speed up the process. Malaysia is a booming country for business owners. The World Bank placed the country 12th out of 190 countries in their Doing Business Report. The process of building your own business in Malaysia has attracted many foreign entrepreneurs.
Even if it is easier to start and grow your business in Malaysia, challenges are still inevitable. Here is a complete guide to help you kickstart your venture in this amazing country.
1. Create a work plan
First things first — preparation. You have to be mentally and financially prepared to start your company. Create a detailed and realistic business plan that will serve as a guide throughout the process. Ask yourself important questions such as:
- How much capital do I need?
- What is the value of my product or service?
- Who are my competitors?
Keeping track of your costs is also important, running a business means that you need to stick to the projected budget at all times.
2. Pick a business entity
Next, determine which type of entity suits your business the best. You can research about the different costs and benefits of each type. Do you want to register as a Sole Proprietor? Or would you rather have a Private Limited Company? This decision will affect your operations and taxes in the long run.
3. Think of a name
You must think of a unique and catchy company name, something that represents the vision of your business. It is important to pick a name that can be easily marketed to the public so it can be remembered well.
Then, check its availability through the Companies Commission of Malaysia (Suruhanjaya Syarikat Malaysia or SSM) website. If the name is cleared, you can proceed to file a reservation and pay MYR 50, valid for one month.
Before you commit to a company name, make sure that:
- The name meets the criteria prescribed by SSM
- It must not contain offensive and misleading words
- Company name does not contain terms that relate to the Royal Family or any Federal and foreign government entities.
- It also cannot contain these words: “Union”, “Foundation”,Chartered”, “Association”, and “Trust”.
4. Find a location
Decide whether your business will be home-based or in a workplace. There are many factors to be considered such as rent space, expenses, length of contract, and more. If you want more foot traffic to help your sales, then it is better to locate in an urban or populated area.
5. Fund your business
Money is always a necessity in any business. Having sufficient capital will enable you to purchase equipment and pay for rent and paperwork. However, not everyone has enough support to start a business. You have to be determined to look for other resources to finance your venture.
Plan ahead and prepare to shell out some money. Take into account personal savings. You may also seek help from angel investors and even venture capitalists. It is also common among Malaysian business owners to take out loans, government grants and other lines of credit.
6. Register your business
It is crucial to obtain a business license from the government. The permits needed varies depending on the nature of your business. Typically you start by requesting for a signboard and trading license for your business space if it is located in a commercial building.
In a nutshell, here is how to register your business in the country:
- Obtain the necessary documents
These include one copy of the company name approval letter from SSM, one copy of the identity card of every director and secretary of your company, Declaration of Compliance, Statutory Declaration By A Director Or Promoter Before Appointment and the Memorandum and Article of Association / Constitution.
2. Incorporate your business
These include one copy of the company name approval letter from SSM, one copy of the identity card of every director and secretary of your company, Declaration of Compliance, Statutory Declaration By A Director Or Promoter Before Appointment and the Memorandum and Article of Association / Constitution.
Once your business name is approved by the SSM, the next step is to submit the incorporation documents within three months.
3. Settle the fees
Pay the company registration fees to officially register your name. It usually costs RM 1,000.
4. Get a copy of the Certificate of Registration
The new business Registration Certificate will be issued to you after one hour of paying the registration fee.
7. Hire qualified employees
You need manpower to get your operations running. But first, you should be prepared to face the responsibilities of being an employer. As head of the company, looking after the well-being of your employees is important. You also have to make sure that they are properly compensated.
In hiring employees, be clear on the qualifications and standards that you are looking for; much better if you have an evaluation system in place. This ensures that only competent employees are absorbed into the company.
8. Build a website
Next is to build your own website, preferably under your own domain. Having a website not only helps with your business identity, but also widens market reach. Creating a website allows you to communicate the different products or services offered by your company.
A website is also easy to maintain and it serves many purposes. It provides information to the customers 24 hours a day and can be used to directly interact with your market. The website can open many opportunities for your business.
Keep in mind that its web design should be user-friendly, and your domain must be catchy enough so it can be easily remembered. The content should also be complete and up-to-date.
To maximize your site’s potential, make sure to include the necessary pages: FAQ, About and Contact page. This way, you can brand yourself as a responsive company and customers will have a good first impression.
9. Implement marketing strategies
Last but definitely not the least is to promote your business to make it sustainable and profitable. For newly-established ventures, it is very important that you get the word out in order to sell your service or product.
It can be as simple as sharing it to your family, friends, and other social groups. You can always work your way up and invest in different marketing platforms when you are financially ready. What is more important is to determine which method can best achieve the goals of your business. After all, there are different options to choose from such as Google and Facebook ads, commercials, giveaways, discounts, and more.
There you have it! These are the fundamental steps in starting a business in Malaysia. It may seem overwhelming at first, but the fruits of the process are definitely worth it.