Opening a Franchise in Singapore: External Factors To Be Considered
Economical
•The population figures and automobile buying capacity of people.
• Strength of business demand for new vehicles.
• Real incomes of car buyers relative to car prices
•The cost and availability of motor finance (credit)
•The cost of running a vehicle
•Income and Employment
•Rate of Interest
Legal
•Legal provision relating to environmental population by automobiles.
•Legal provisions relating to safety measure
•Anyone who wishes to register a new vehicle in Singapore must first obtain a Certificate of Entitlement (COE), which represents the right to own a vehicle for 10 years.
•A Registration Fee of S$140 covers the costs of registering a vehicle in Singapore. It is collected upon registration of the vehicle. Overall cost of the car
•Registration fee + Cost Price + Road Tax + COE + additional registration fee (140% of OMV) and customs duty (31% of OMV).
Substitution
MRT & LRT Trains, Buses, Taxis
Rental services
•Avis
•Budget
•Hertz
Force 1: Barriers to entry
Barriers to entry measure how easy or difficult it is for new entrants to enter into the industry. This can involve for example: * Cost advantages (economies of scale, economies of scope)
* Access to production inputs and financing,
* Government policies and taxation
* Production cycle and learning curve
* Capital requirements
* Access to distribution channels
Force 2: Threat of substitutes
Every top decision maker has to ask: How easy can our product or service be substituted? The following needs to be analyzed: * How much does it cost the customer to switch to competing products or services?
* How likely are customers to switch?
* What is the price-performance trade-off of substitutes?
If a product can be easily substituted, then it is a threat to the company because it can compete with price only
2. Threat of Substitutes - Rather than looking at the threat of someone buying a different car, there is
•The population figures and automobile buying capacity of people.
• Strength of business demand for new vehicles.
• Real incomes of car buyers relative to car prices
•The cost and availability of motor finance (credit)
•The cost of running a vehicle
•Income and Employment
•Rate of Interest
Legal
•Legal provision relating to environmental population by automobiles.
•Legal provisions relating to safety measure
•Anyone who wishes to register a new vehicle in Singapore must first obtain a Certificate of Entitlement (COE), which represents the right to own a vehicle for 10 years.
•A Registration Fee of S$140 covers the costs of registering a vehicle in Singapore. It is collected upon registration of the vehicle. Overall cost of the car
•Registration fee + Cost Price + Road Tax + COE + additional registration fee (140% of OMV) and customs duty (31% of OMV).
Substitution
MRT & LRT Trains, Buses, Taxis
Rental services
•Avis
•Budget
•Hertz
Force 1: Barriers to entry
Barriers to entry measure how easy or difficult it is for new entrants to enter into the industry. This can involve for example: * Cost advantages (economies of scale, economies of scope)
* Access to production inputs and financing,
* Government policies and taxation
* Production cycle and learning curve
* Capital requirements
* Access to distribution channels
Force 2: Threat of substitutes
Every top decision maker has to ask: How easy can our product or service be substituted? The following needs to be analyzed: * How much does it cost the customer to switch to competing products or services?
* How likely are customers to switch?
* What is the price-performance trade-off of substitutes?
If a product can be easily substituted, then it is a threat to the company because it can compete with price only
2. Threat of Substitutes - Rather than looking at the threat of someone buying a different car, there is