Introduction
Hong Kong has long been recognised as one of the most business-friendly cities in the world. With its open economy, robust legal framework, and status as a gateway to Mainland China, Hong Kong presents compelling opportunities for Singapore small and medium-sized enterprises (SMEs) looking to expand internationally. Whether in finance, retail, logistics, technology, or professional services, Hong Kong offers a strong foundation for regional growth.
However, entering a foreign market—no matter how familiar—comes with its own challenges. That’s where the Market Readiness Assistance (MRA) Grant from Enterprise Singapore plays a pivotal role. Offering up to 50% co-funding (capped at S$100,000 annually), the MRA Grant supports Singapore SMEs across overseas market promotion, business development, and market setup activities.
In this article, we explore how Singapore companies can successfully enter the Hong Kong market and how the MRA Grant can help mitigate costs and de-risk expansion.
Why Hong Kong?
1. World-Class Business Infrastructure
Ranked among the top economies for ease of doing business, Hong Kong has efficient company registration processes, low tax rates, and a pro-business government. It’s an ideal launchpad for companies seeking to scale quickly in North Asia.
2. Financial Hub with Global Reach
Hong Kong is Asia’s leading international financial centre. For fintech companies, wealth management firms, and financial services providers, Hong Kong provides unmatched connectivity and a high concentration of affluent individuals and corporations.
3. Gateway to Greater Bay Area (GBA)
Hong Kong plays a strategic role in China’s Greater Bay Area (GBA) initiative, linking cities like Shenzhen, Guangzhou, and Zhuhai. Businesses can leverage Hong Kong as a springboard into the vast and affluent South China market.
4. Cultural and Commercial Familiarity
With a common use of English, strong rule of law, and a cosmopolitan consumer base, Hong Kong is relatively easy for Singapore companies to navigate compared to other regional markets.
5. High Spending Power
Hong Kong boasts one of the highest per capita GDPs in Asia. Consumers are brand-conscious and willing to pay a premium for quality goods and services—particularly in sectors like beauty, wellness, education, and fashion.
Business Opportunities for Singapore SMEs
1. Retail and F&B
Hong Kong’s vibrant mall culture and food scene make it an excellent market for Singapore F&B concepts and lifestyle brands. Consumers favour innovation, quality, and branding.
2. Financial Technology and SaaS
As a global finance hub, Hong Kong demands cutting-edge fintech tools, regulatory technology (regtech), and enterprise-grade SaaS platforms. Singapore tech firms can provide secure, scalable solutions.
3. Education and Enrichment
There is strong demand for international education content, tuition, early childhood enrichment, and adult upskilling—areas where Singapore providers have strong credentials.
4. Professional Services
Accounting, legal, HR, marketing, and compliance services are in demand, especially among startups, SMEs, and multinationals setting up regional offices.
5. Wellness and Medical Aesthetics
The affluent population in Hong Kong values appearance and wellness. Aesthetic clinics, skincare brands, and wellness technology from Singapore are well-received.
Challenges of Entering Hong Kong
While Hong Kong offers many advantages, SMEs must also plan for certain challenges:
1. High Operational Costs
Office rentals, retail spaces, and staffing costs are among the highest in Asia. Startups and SMEs should consider flexible or co-working spaces and lean operational models.
2. Intense Market Competition
Being an open market, Hong Kong has strong local and international competition. Singapore SMEs must focus on strong branding, niche positioning, and value differentiation.
3. Regulatory Licensing
Some industries—like F&B, healthcare, and finance—require licenses and permits from local authorities. Legal consultation is essential to ensure compliance.
4. Local Preferences
While English is widely spoken, cultural preferences can vary. Businesses should localise their customer service, marketing, and user experience to suit Hong Kong sensibilities.
How the MRA Grant Supports Expansion into Hong Kong
The MRA Grant provides co-funding for eligible activities across three main categories:
1. Overseas Market Promotion
Branding and visibility are key to entering the Hong Kong market. The MRA Grant supports:
- Paid digital marketing on platforms like Facebook, Instagram, Google, and local portals such as SCMP and Yahoo! HK
- Design and development of promotional materials in English and Traditional Chinese
- Participation in trade fairs, roadshows, or pop-up events in Hong Kong
- Public relations and influencer marketing campaigns with local Key Opinion Leaders (KOLs)
Example: A Singapore vegan skincare brand could use the grant to run ads on Facebook targeting female urban professionals in Hong Kong and collaborate with local beauty influencers.
2. Overseas Business Development
This includes services that help businesses explore the market and build partnerships. The grant funds:
- Engagement of business consultants for market entry strategies
- Business matching and networking services to connect with distributors or resellers
- Feasibility studies or competitor analysis
Example: A Singapore edutech platform may hire a Hong Kong-based consultant to assess local curriculum compatibility and recommend school partnerships.
3. Overseas Market Setup
Setting up your business legally and operationally in Hong Kong is made easier with the grant covering:
- Incorporation of Hong Kong companies or representative offices
- Legal advisory on local regulations and licensing
- Accounting and tax advisory for compliance
- Intellectual property protection, including trademark registration
Example: A Singapore marketing firm setting up a satellite office in Hong Kong could claim incorporation, legal, and tax advisory fees under the MRA Grant.
Eligibility Criteria
To qualify for the MRA Grant, your company must:
- Be registered and operating in Singapore
- Have at least 30% local shareholding
- Have a group annual turnover not exceeding S$100 million OR employment size not exceeding 200 employees
- Have no significant existing presence in Hong Kong at the time of application
Only third-party expenses and pre-approved activities are eligible for co-funding.
How to Apply for the MRA Grant
Step 1: Define Project Scope
Create a business plan for Hong Kong market entry. This includes your objectives, target audience, marketing channels, operational needs, and expected results. Engage suitable service providers and request official quotations.
Step 2: Submit Application via Business Grants Portal
Log in with CorpPass and provide:
- ACRA BizFile
- Latest audited/management accounts
- Project scope and timeline
- Vendor quotations
- KPIs and expected business outcomes
Step 3: Wait for Approval
Enterprise Singapore may take 4–8 weeks to review your application. Additional documentation or clarification may be requested.
Step 4: Receive Letter of Offer (LOF)
Once approved, a Letter of Offer will be issued. Do not begin your project until the LOF is received.
Step 5: Execute the Project
Proceed with marketing campaigns, market research, or setup activities as per the approved application.
Step 6: Submit Claims
After project completion, submit:
- Invoices and proof of payment
- Deliverables (e.g., marketing materials, research reports, incorporation documents)
- A post-project report outlining outcomes
Use Case Scenarios
1. Retail Brand Entry
A Singapore fashion label launches a temporary pop-up store in Central Hong Kong. It uses the MRA Grant to cover event logistics, local ads, and PR agency costs.
2. Professional Services Setup
A Singapore HR consultancy opens a branch office in Wan Chai. Legal incorporation, business development services, and tax registration fees are subsidised by the MRA Grant.
3. Digital Platform Promotion
A Singapore mobile app startup targets young professionals in Hong Kong with a paid Instagram and Google Ads campaign. Ad creatives and analytics tools are partially funded through the grant.
Tips for Success in Hong Kong
1. Adapt to Fast-Moving Trends
Hong Kong consumers are trend-conscious and digitally savvy. Stay up to date with industry trends and consumer behaviour through local research and feedback loops.
2. Focus on Quality and Brand Storytelling
Hong Kong consumers value reputation, branding, and storytelling. Use your Singapore origin as a trust signal, and highlight your product USPs clearly.
3. Engage Bilingual Professionals
Engaging partners who speak both English and Cantonese ensures smoother communication with stakeholders and customers.
4. Start Lean
Due to high costs, begin with a small representative office or test with cross-border e-commerce before fully committing to large-scale operations.
5. Utilise Local Networks
Leverage the Singapore Chamber of Commerce in Hong Kong and participate in local trade events to build credibility and contacts.
Conclusion
Hong Kong is a strategic market for Singapore SMEs seeking to establish a North Asia presence. Its free-market policies, high spending power, global connectivity, and access to the Greater Bay Area make it a uniquely valuable destination. From retail and education to professional services and tech, the opportunities are abundant for well-prepared businesses.
The MRA Grant provides the financial boost needed to test, promote, and set up your business in Hong Kong while managing risk and cash flow. By tapping into this support, your business can confidently explore one of Asia’s most dynamic and resilient markets.
For Singapore SMEs aiming for sustainable international growth, Hong Kong isn’t just a stepping stone—it’s a strategic partner in success.