Create Wealth

Gold's 10 percent gain in 2011

2011-12-30T18:32:00.001-08:00

Gold rose 1 percent on Friday, rebounding from losses earlier this week. That meant that the yellow metal had made its 11th consecutive year of gains. The gain was 10 percent for the whole year of 2011 but if the comparision is taken from September, where it made its high of $1920.30 - then it would be a loss in its quarter in more than three years. Gold fell heavily in December, as hedge funds scrambled for cash to meet client redemptions and European banks trimmed their gold holdings to raise capital. It would be worth noting that U.S. February gold futures contract settled up $25.90 at $1,566.80, snapping six straight sessions of losses. However,despite a rally on Friday, technical factors suggested that gold momentum is in the bearish region:

Bullion's 20-day moving average dipped below its 200 DMA on Thursday, as short-term momentum has turned more negative than long-term momentum and could show that the current downtrend is pervasive.

How to buy Gold in Singapore and Not have the hassle of keeping them?

2011-11-06T05:46:00.000-08:00

Want to invest in gold? But deterred by the risks and hassle of keeping physical gold bars? Then gold investment accounts, which allow you to buy and sell gold and keep track of your transactions through a passbook, may be for you.

As of June last year, gold investment accounts were only available at three banks — Kuwait Finance House, Public Bank and Maybank. Due to gold’s growing popularity, CIMB and United Overseas Bank (M) (UOB) have jumped onto the bandwagon as well. All banks, except for Kuwait Finance House, use Swiss Pamp as the underlying gold bar for their gold investment accounts.

Kuwait Finance House uses a generic gold bullion and UOB uses different gold bullions. Investors can select their preferred brand when making a withdrawal. You must have a savings or current account at the bank to open a gold investment account.

On Aug 23, gold prices hit a record US$1,911 (RM5,688) an ounce in Asia. On the back of rising prices, the buy and sell prices of gold investment accounts have also increased by about 30% over a period of 15 months.

A year ago, the precious metal’s purchase price (the price at which the banks buy the gold from customers) ranged from RM121 and RM123, and the sell price (the price at which the banks sell the gold) ranged from RM126 to RM128. At the end of August, the buy price ranged from RM174 to RM178, while the sell price ranged from RM180 to RM185.

To enhance your returns, choose an account that has the smallest spread (the difference between the buy and sell prices). New players such as UOB and CIMB offer the narrowest spreads, with UOB outshining its competitors with 0.55% and 1.1% for the Premier Gold Account and Gold Savings Account respectively. Kuwait Finance House has the highest spread of 4.45%.

As always, watch out for fees that will negate your returns. CIMB, Public Bank and UOB impose a fee if the minimum balance falls below a stipulated level at month- and year-ends. Kuwait Finance House does not impose any additional fees. Public Bank levies the highest fees; when customers make a withdrawal of physical gold, the conversion fees ranging from RM220 to RM270 are the highest among the banks.

Think about the type of withdrawals that you want to make from these accounts. Not all banks allow you to withdraw physical gold, and if it does, a conversion fee might be levied. For example, at CIMB, if you withdraw 10g of physical gold, you would still get the best nett return despite the conversion fee of RM1 for every gram of gold (based on bank’s buy-sell prices as at Aug 22).

Consider, too, how much money you can set aside for your investment. Maybank offers the lowest entry barrier with a minimum deposit of 1g. It also imposes the lowest minimum balance of 1g. In contrast, UOB requires the highest minimum initial deposit and balance, although it offers the narrowest spread. And there is a penalty, if there is a total withdrawal.

As with any other investments, do not forget to evaluate the risks. While such accounts permit you to reap favourable returns from appreciations in gold prices, you will make a loss if the price of gold plummets. These gold investment accounts do not earn interest income and the balance kept in the account is not protected by the government’s deposit insurance scheme, Perbadanan Insurans Deposit Malaysia (PIDM). Well, potential investors are reminded again that Gold investment is not without its risk. For analysis relating to spot gold price, please refer.

A call for another reserve currency

2011-08-08T05:34:00.000-07:00

For most of the world, the never ending saga over the debt ceiling confirmed what many have long believed: The United States dollar is no longer worthy of its status as the world's reserve currency. This is re-inforced by the weakening US dollar against most currencies except the Euro.. The Euro is also badly tarnished at the moment. The yen is strengthening only because it is less tarnished, thanks to its "relatively less expanded balance sheet". And in the midst of all these, China - when it removes its restrictions on its capital account will be the most credible contender for the reserve currency status. Even if that does not come about, it will be most likely one of the basket of world currencies to be likely chosen as the alternative to US dollars. The US dollars continue to weaken irregardless.

which bank has the best RMB rate

2011-06-22T08:20:00.000-07:00

With China looking to turn the renminbi (RMB) into an international currency, several banks in Singapore have begun offering renminbi deposit services. This article takes a look at the rates and details of the offerings from HSBC, Bank of China, DBS and UOB.

Making RMB deposits will involve the conversion of your currency into RMB. Different institutions offer different conversion rates, and these are subject to fluctuations. It is advisable to compare exchange rates at different institutions for better returns.

Similarly, interest rates on deposits vary among different banks, and over different time periods. Customers should consider both the conversion rate and interest rate offered by an institution in order to determine the overall returns on the investment (principal amount + interest earned). Comparing overall returns for identical deposit amounts and time periods at different institutions will help you decide whose services to use.

HSBC's RMB Deposit offerings

HSBC's Multi Currency Savings Account offers RMB deposits with tiered interest rates, so higher savings earn more. The initial deposit required is S$2,000 (or equivalent). This initial deposit will be waived for customers who have Dual Currency Plus and other investments with HSBC. Current interest rates range from 0.20 percent for deposits between RMB10,000 and 349,999, to 0.35 percent for deposits above RMB 350,000.

HSBC also offers RMB time deposits. HSBC Advance customers require a minimum of RMB 250,000 to open a RMB account while HSBC Premier customers require RMB350,000. Current interest rates for all deposit amounts are at 0.25 percent for one-month and two-month terms, 0.35 percent for three-month terms and 0.45 percent for six-month and twelve-month terms.

HSBC's Foreign Currency Deposits also offer capital gains if exchange rates move in the customer's favour. There is no capital gains tax in Singapore, and furthermore, for non-residents, the interest earned on Foreign Currency Deposits is not subject to Singapore income tax or withholding tax.

Bank of China's RMB Deposit offerings

Bank of China, the pioneer in providing RMB services in Singapore, also offers RMB services in its Multi Currency Savings Accounts and Time Deposits. The Multi Currency Savings Account requires an initial deposit of S$1,500 (or equivalent). In order to apply for the Multi Currency Savings Account, customers can visit any of the bank's branches with valid travel documents and proof of address documents, such as utility bills or bank statements.

Bank of China's RMB Time Deposit offers promotional interest rates until the 31st of July 2011, ranging from 1.78 percent per annum for a six-month time deposit of RMB10million (S$1.9million) and above, to a rate of 1.20 percent for a one-month deposit of RMB250,000 to RMB1 million. Deposits have to be fresh, not transferred from other RMB accounts with the bank, and must be by way of foreign exchange conversion at the bank's prevailing foreign exchange rate(s), from non-RMB denominated currencies.

The regular, non-promotional annual interest for RMB 200,000 and above for a six-month term is 0.45 percent, and 0.40 percent for deposits up to RMB 199,999.99. Customers can visit any of the branches with identification and proof of address documents in order to apply.

DBS's RMB Deposit offering

DBS's Foreign Currency Fixed Deposit Account allows the customer to set funds aside for a fixed duration to benefit from a fixed interest rate. Now, the customer can make RMB-denominated fixed deposit placements with a minimum deposit of S$5,000 or its equivalent. Interest rates range from 0.50 percent for bank balances above RMB 2.5million (S$750,000 approximately), to 0.385 percent for deposits below RMB 250,000.

Deposits into the Foreign Currency Fixed Deposit Account are chargeable. If the deposit amount is in RMB, a commission-in-lieu of exchange (min S$10) applies. If it is in a different currency, the notes are converted to S$ equivalent and then re-converted to RMB at the prevailing exchange rates.

UOB's RMB Deposit offerings

UOB has also introduced two RMB deposit accounts. Firstly, the UOB Foreign Currency Fixed Deposit pays interest rates ranging from 0.9 percent for a one-month deposit of at least RMB 250,000, to 1.45 percent for a 12-month deposit of at least RMB 5 million. No fees are required to maintain the account, which can be opened by visiting any of UOB's branches, or via telephone.

Secondly, UOB offers the Global Currency Premium Account exclusively to UOB Privilege Banking clients. The initial deposit and minimum average daily balance is RMB5,000, and the minimum balance fee, applicable when the account's average daily balance for the month falls below the minimum average daily balance, is RMB50. The interest rate is 0.50 percent for deposits less than RMB 250,000, and is automatically escalated to 0.75 percent p.a. for deposits amounting to RMB 250,000 and above.

Risks involved in making RMB deposits

Ensure that you are aware of the risks involved in making RMB deposits:

1. There may be a gain or loss when you convert foreign currency as exchange rates are subject to fluctuation. In addition, you may be subject to foreign exchange controls which may be imposed from time to time.

2. RMB is not a freely convertible currency and is subject to regulation changes initiated by China and/or local authorities. Apart from exchange rates fluctuation risk, customers face liquidity risk. It is important to choose a deposit tenor suitable to your needs.

3. If you withdraw your fixed deposit before it matures, a fee might be imposed, and you might earn less or no interest.

4. Foreign currency deposit accounts, unlike eligible local accounts, are excluded from insurance coverage under the Deposit Insurance Act.

So who offers the best rates? Well it depends on how much you have to deposit, but, at the moment, Bank of China's promotional rate of 1.20 percent is attractive if you have RMB250,000 and above to place.

If you are looking at long-term investments, it is advisable to choose institutions that have a suite of different RMB services that provide you with more options and minimise currency loss. It is also advisable to learn about fund-withdrawal procedures at each institution, as some may require you to make withdrawals in non-RMB currencies.

(Note: 1 CNY = 0.191584 SGD at the time of writing)

Etf's to play wheat

2011-01-10T00:32:00.000-08:00

With the recent slide in the U.S. dollar, the U.S. suppliers not only became more competitive than their European counterparts but were expected to dominate the international wheat market. Everything should be going well for U.S. wheat exporters except for the rising freight costs. Supply disruptions could also put upward pressure on wheat prices. Already at elevated levels after soaring to two-year highs in the wake of Russia's ban on grain exports, analysts fear that any supply shocks could push wheat markets higher. Meanwhile, U.S. wheat futures at the Chicago Board Of Trade closed higher for the third day - on dryness threatening winter. ExportsTraders have become downbeat about the prospects for European Union wheat in recent weeks due to a tail off in demand due to waning supplies and high prices. Exports from the bloc started at near-record levels this week as suppliers scrambled to secure demand after Russia banned grain exports for the year. Market participants said that this move signaled the increasing dominance of the U.S. in export market.ETF Options for Wheat Investment. Although there are no wheat-specific ETFs, some of the ETFs worth considering to play the current wheat rally include:

ELEMENTS Rogers Intl Commodity Agric ETN Profile (RJA): The Index represents the value of a basket of 20 agricultural commodity futures contracts and is a sub-index of the Rogers International Commodity Index. The top holdings include: wheat (20%), corn (14%), cotton (12%), and soybeans (9%).Expense Ratio: 0.75%2.

ELEMENTS MLCX Grains Index TR ETN (GRU): The index is designed to provide a benchmark for the grains sector and for investment in commodities as an asset class. The Index comprises futures contracts on four physical commodities: Corn, soybeans, soybean oil and wheat. The Index is a total return index; thus it is designed to reflect the performance of a fully collateralized investment in the index components. The top holdings are: wheat (47%), corn (36%), soy meal (10%), and soy beans (8%).Expense Ratio: 0.75%Some of the other broad Agriculture related ETFs that include soft commodities having wheat futures contracts in varying amounts include:
PowerShares DB Agriculture (DBA): Wheat is 12.6%
PowerShares DB Commodity Index Tracking (DBC): Wheat is 5.6%

Should you jump into commodities?

2009-10-11T07:15:00.000-07:00

Should you jump into commodities? aah.. these are questions that u should answer... bearing in mind the kind of risks you will need to bear.

The skyrocketing prices of commodities such as crude oil and gold have made this asset class a hot topic among investors. With commodity prices at historical highs, investors are wondering if the cycle has peaked. Some call it a commodities bubble that will burst soon.

Morgan Stanley economist Stephen Roach believes prices will tumble amid a United States recession and property market collapse. Others warn that commodities trading is the riskiest way to invest your savings because of the wild gyrations in prices.

But 'bulls' such as veteran US investor Jim Rogers beg to differ.'We are in a bull market for commodities that is likely to last beyond 2020,' he said. 'This is because supply and demand got terribly out of whack years ago.

It will take many years to build new capacity by opening new mines or discovering new oil fields.'In the meantime, prices will be pushed up as the available supply cannot satisfy the voracious appetites of emerging economies.

For the average retail investor, taking the middle-of-the-road approach is to assume that the fastest growth has already come and gone. So you should be more selective and pick commodities that are likely to enjoy a sustained plateau in prices, rather than those whose prices might spike temporarily and then flop over time..

So how can an investor get his toes wet without drowning?

Commodity indexes

THESE act like stock indexes, tracking a group of commodities for benchmarking and investing purposes. They are constructed and managed by various financial institutions. Since mid-1998, the Goldman Sachs Commodity Index has seen returns of 265 per cent and the Dow Jones-AIG Commodity Index 234 per cent.

Exchange-traded funds

FOR investors, exchange-traded funds (ETFs) offer exposure to gold, silver, oil, individual commodity sectors and broad-based commodity futures indexes. Take the Singapore Exchange's Lyxor ETF Commodities CRB, which is based on the Reuters/Jefferies CRB Index. It is made up of a basket of 19 commodities that range from energy, industrial metals and agriculture to livestock. Since it was listed in January, its net asset value has risen from US$2.71 to over US$4.04.

EMERGING market funds, which are Mutual funds, in particular, allow you to participate in the commodities boom by tapping the growth of countries blessed with raw materials. These include South Africa, which has the world's largest gold reserves; Saudi Arabia, which boasts the largest oil reserves; and Cuba, a huge sugarcane producer.Among the many options available are Schroder Investment Management's agriculture fund and alternative solutions commodity fund, the UOB United Global Emerging Markets Portfolio and Pimco's emerging markets bond fund.

Commodity-linked stocks

YOU can buy shares of Singapore-listed commodity traders and producers such as Indofood Agri, Golden Agri, Straits Asia Resources, First Resources and Wilmar. There are also commodity-related stocks such as those of oil-rig builder Keppel Corp. Investors take on both corporate and equity market risks when they buy into these stocks. They typically have a higher correlation to equity markets than commodity markets.
Reasons for investing in Commodities: They are considered a good hedge against rising inflation.The past few years of torrid growth in emerging economies such as China and India have created massive demand for a plethora of raw materials. That demand, in turn, has pushed up the prices of these commodities, faster than inflation.Commodities are also viewed as a powerful tool for diversifying one's portfolio.

Historically, they have a negative correlation with both stocks and bonds. In other words, when these fall in price, commodities tend to head north. In the past few months, while global stock markets plunged, prices of commodities such as gold, crude oil, wheat and palm oil have hit all-time highs. For those of you who are wary of sinking money into the stock market now, but do not want your cash to sit in a bank and shrink in value as inflation climbs above 5 per cent, commodities might be a good way to keep your savings intact. Financial advisers say a typical diversified portfolio might include 5 per cent commodities, 60 per cent stocks, 25 per cent bonds and 10 per cent Treasury bills.

FOR THE RISK-TAKING INVESTOR....

Buying directly into the future of energy, metals ..IF YOU are a relatively sophisticated investor aged 21 or over, you can open a derivatives trading account at most major brokerages such as Phillip Securities or DBS Vickers Securities. This will allow you to trade futures contracts on exchanges worldwide - from Bursa Malaysia's ringgit-denominated crude palm oil futures contract (FCPO) to metals contracts on the Chicago Board of Trade (CBOT) and the New York Mercantile Exchange (Nymex). A futures contract represents a financial obligation to buy a certain quantity of a physical commodity at a preset date and price. Most brokerages will let you deposit your funds in Singapore dollars or any other major currency. You can trade on futures exchanges and over-the- counter foreign exchanges on a margin basis, which means you can leverage so as to trade contracts with a larger nominal value. The margin is set to cover the price risk of the portfolio for a specified period.There are three categories: energy and metal futures, which generally mean 'hard' commodities, and agriculture futures, for 'soft' commodities. Energy OIL could soar to higher levels. But investors need to be well-versed in the price dynamics of the many varieties of oil contracts from light sweet crude to brent, which are traded on Nymex and the IntercontinentalExchange (ICE).

Metals

THE star performer last year was copper. Shortages due to inefficient excavation of old mines pushed up the price to over 360 per cent of the 2003 level. Some investors buy the stocks of big miners such as Freeport McMoRan and Southern Copper, but to do this, you need to open overseas trading accounts via your local broker. Copper plays into the popular investment theme of 'What China Is Buying'. China's rapid infrastructure development has made it the world's largest consumer of many metals, but you zoom in on the ones it needs to import. Zinc is abundant in China, while copper is found mainly in South America and tin in Indonesia.For aluminium, China used to rely on its own production, but it is likely to become a net importer this year. Said Standard Chartered commodity analyst Judy Zhu: 'The government clamped down on production a few years ago, so this may support global prices.'Many investors are going for gold because the weakening greenback has pushed prices above US$1,000 an ounce currently. But they might still have further to go.

Also, gold is more easily accessible investment-wise than some other metals. You can buy or sell physical gold such as gold bars, or gold certificates from banks such as the Canadian Bank of Nova Scotia and United Overseas Bank (UOB), but this attracts GST of 7 per cent.Singapore investors can use monies in their Central Provident Fund Investment Scheme-Ordinary Account(CPFIS-OA), but the sum cannot exceed the available Gold Limit, which is 10 per cent of the total CPFIS-OA funds. One thing to note is the high investment outlay for gold. A one-kilobar certificate can cost over $36,000.For sophisticated investors who want exposure to a variety of hard and soft commodities, ABN Amro is preparing to launch a call warrant that tracks the RICI Enhanced Global Index, an index designed by the bank and veteran investor Jim Rogers.It will be based on the RICI, a commodity index developed by Mr Rogers in 1998 that covers 37 commodities and has generated returns of more than 500 per cent since July 1998.Called zero strike participation certificates, or zero certs, the warrants have an exercise price of zero. If the index goes up by $1, the issue also gains $1, which makes it easier to track the performance of the index and calculate capital gains. Each zero cert has an initial price of about $1; the minimum investment is about $1,000.

Soft commodities

THIS is a growing investment theme because consumers in China and India are wolfing down more food as standards of living rise. For instance, estimates put the wheat consumption of these two countries at as much as 39 per cent of the world's total supply.In addition, with the 'green' movement, legislation in some places such as California has pushed farmers to grow corn not for food but to make ethanol-based energy products.But beware the extreme volatility in the prices of soft commodities, including coffee, palm oil and rice, which spoil easily. Palm oil producers, for instance, who have a huge harvest might have to dump it on the market within a few weeks before it rots.A savvy farmer might hedge his crop by selling futures contracts to lock in the price at which he will sell the palm oil. This hedging activity, combined with natural harvest cycles and unpredictable weather, can generate extreme swings in prices. Corn prices could test new highs if demand for ethanol-based energy sources continues to soar.

Unconventional plays

SOME off-the-beaten-track investments with upside potential include uranium and palladium.Some experts say uranium prices are likely to go 'nuclear' in a few years as traditional sources of energy such as oil and coal run out and 'cleaner' sources such as uranium trump more expensive ones such as ethanol-based energy.There are indications that global demand for uranium might surge in a few years. As of the middle of last year, there were 30 nuclear plants under construction globally, while another 70 had been planned and 150 more proposed. Meanwhile, supply from uranium mines and decommissioned nuclear weapons is limited.Palladium recently made a popular debut as the new 'platinum' in jewellery, especially in the China market because it is cheaper for jewellery buyers to use while providing immense profit margins for manufacturers.Consumption by the jewellery industry has more than tripled over the past two years, rising to 1.13 million ounces a year.

How do you set up a construction company?

2009-10-04T07:09:00.000-07:00

I was just thinking the other day about.... hmm..How to set up a construction company? My Dad who is an experienced civil engineer is thinking of setting up a construction company together with a couple of his friends. He wants me to prepare a feasibility study report to that effect. what are the specific issues i need to look at?

This is a pretty complicated question but I will give it a shot. Contracting is about getting the work, doing the work and accounting for the work. If any of these things fail, the enterprise will not succeed.My business plan needs to address sources of income. What particular skill or values does allow us to look different than the competition. How is that skill going to be utilized to drive income? How much income is needed? What geographic area is to be covered? Who is going to sell the work? Who are potential customers? What is the competitive profile of the other people currently contracting for this work? Is the work going to be residential or commercial? Is the economy in the region robust? As far as doing the work, I need to have people that can estimate the cost of the work accurately, develop and execute the appropriate contracts, expedite the materials, schedule the work, hire the field crews, supervise the work, read, detail and understand the drawings, install the work, close out the work and do warrantee work when issues come up. As far as accounting and finance; The business plan needs to model income, cost of doing the work, gross margin, overhead expenses, and net income. And there is this thing about tax payment. The construction business has low barriers to entry so competition is rampant and drives margins down. At the end of the day it would be considered well to make 5%. In addition to modeling expenses and income, I may need to address banking, bonding, licensing and other needs that are required in the business before obtaining my first project. Hmm.. someone recommended a book by Thomas Schliefer called a Contractors Survival Guide.

Start first with Budgeting your Expenses

2009-08-01T04:09:00.000-07:00

A budget is the most fundamental and most effective financial management tool available to anyone.

Yes, anyone—whether you are earning thousands of dollars a year, or hundreds of thousands of dollars a year. It is extremely important to know how much money you have to spend, and where you are spending it.

Budgeting and Investing are Different Topics

Yes, some of your "spending" might be for investments, but there is an important distinction between creating a personal budget and deciding where to invest your extra income. A budget is the first and most important step towards maximizing the power of your money.

What is in it for you?

Just about everything. A carpenter would never start work on a new house without a blueprint. You would not get in a car for a cross-country road trip without a map (we hope not). An aerospace firm would not build a rocket booster without a detailed set of design specifications. Yet many of us find ourselves in the circumstance of getting out on our own and making, spending, and investing money without a plan to guide us.

ONLINE TOOLS ON HOW TO BUDGET
Budgeting is about planning. And planning is crucial to produce a desired result.

How to invest in Gold in Singapore

2009-07-19T09:15:00.000-07:00

The UOB Gold Savings Account is probably the simplest, if not easiest way to invest in gold. According to the UOB website, you can buy and sell international gold - through a passbook - at prevailing market prices and transact any time during banking hours in units of one gm of gold, subject to a minimum of five gm per transaction.

To simply put, you are depositing cash into your UOB Gold Savings Account and the bank teller will convert your cash amount into grams of gold and record it in your passbook. This method of investment is considered as investing in paper gold.To sign up, all you have to do is to approach any UOB branch and ask to open an UOB Gold Savings Account.

You will be required to produce your identification card to open the account. The process is similar to opening a UOB cash savings account.Depositing and withdrawing from your UOB Gold Savings Account is just as easy. Simply approach the bank teller at any UOB branch to make your deposit. You must bring your passbook along for each deposit or withdrawal transaction.

As the transaction is considered a deposit and does not involve any purchasing, there is no Goods and Services Tax (GST) levied. Naturally, no premium for production of gold is charged because there is no physical gold involved. The bid spread of S$0.10 between the buying and selling price for each gram of gold is considered very thin as well.Sounds good so far? Like every investment vehicle, the UOB Gold Savings Account is without its own set of disadvantages.

Firstly, you cannot withdraw physical gold from your UOB Gold Savings Account. Only cash withdrawals are allowed.Secondly, you will be charged an administrative fee (in grams of gold) of 0.12 gram per month or 0.25% p.a. on the highest balance per month, whichever is higher. This makes keeping low balances in your UOB Gold Savings Account not worth your while.

In my opinion, I find that the UOB Gold Savings Account is a good investment vehicle for investors who simply want their cash to be valued in terms of gold. I use my UOB Gold Savings Account for short term deposits because if the liquidity. The account also allows me to lock in on the price of gold at that period of time. Eventually, I will withdraw the amount to buy physical gold.So if you are looking for high liquidity, ease of transactions, and do not mind the fact that you are buying paper gold, the UOB Gold Savings Account is the investment vehicle for you.For more gold investment articles, visit Bullion Gold

Try UOB if you are looking to buy gold in Singapore or trade gold in Singapore. I believe they are the only bank which deals in gold and silver. However they DO NOT allow delivery of physical silver from their silver accounts. The UOB gold account unlike the silver account allows delivery of physical gold. You can buy gold bullion coins such as Canadian Maple Leafs, Kruggerands, American Gold Eagles and Australian Kangaroos.

However, do take note that there are also potential risk in gold investment. For current analysis on gold price movements, please refer.

Some Simple Steps to creating wealth

2009-06-21T04:55:00.000-07:00

If ideas are hard in coming, dont wait... get employed first while you wait for THAT MILLION DOLLAR DREAM to start...
At least for now... : )

What's in a name?

2008-08-11T03:40:00.000-07:00

WHAT'S in a product name? A lot. Choose the wrong one and you could seriously damage your company's prospects; get it right and the world will beat a path to your door.

Ask Creative Technology. Calling its MP3 player the Creative Nomad Jukebox was a mistake as it was just too long and too complicated, said marketing strategist Al Ries.

'The name is the single most important marketing decision you can make,' Mr Ries told The Straits Times, ahead of this week's Global Brand Forum, where he will be one of the speakers.

Although Creative was the first in the market with an MP3 music player, it lost out to Apple, which had a 'superior brand name - iPod - and a superior marketing strategy'.

But not only is the product name Nomad Jukebox a handicap, even the brand name Creative does not do the company any favours. If an Asian company like Creative wants to develop a global brand, it cannot take on such a generic name. 'All products are creative,' he said.

Mr Ries made his name from his book, Positioning: The Battle For Your Mind. He noted that successful companies advertised their products in such a way that consumers associated the function with the brand name. Look at Xerox - the product name has become a widely- used term for photocopying.

Another problem Creative faces in trying to build up a global profile is that it is offering a broad line of products and services marketed under a single brand name.

Mr Ries believes Creative 'will never become a big global brand because the name encompasses too many products'.

He points to the successful brands such as Starbucks, Absolut and Coca-Cola, which all sprang from a single product.

Once the brand is famous, however, it can extend its product line. Sony did this by establishing its presence with Walkman before branching into different products. Traps that Asian companies fall into when trying to break into the global brand arena include forgetting how the name sounds in English.

Mr Ries said that with English being so widely spoken worldwide, companies cannot afford to ignore their brand name's English version.

Many Chinese brand names, he reckons, will not make it on the global stage simply because they are not only difficult to spell but also to pronounce for an English speaker. This is not a problem exclusive to Chinese companies. While British and American firms benefit from their English-speaking cultures, European companies in places like Poland, for example, would be in the same boat.

A name should be 'short, easy to spell and pronounce and connotes what the brand stands for'.
Take Taiwan PC maker Asus. It has achieved much success after pioneering the first ultra-compact laptop computer, the Eee PC. But in the long run, Mr Ries thinks the 'weak' brand name and the 'weak' model name could be a liability.

Conversely, Ralph Lauren would not have been half the success he is if he had launched a brand using his real name, Ralph Lifshitz.

Asian companies do face an uphill task creating their own unique brand, agreed public relations expert Al Golin, founder and head of the worldwide PR agency GolinHarris. Mr Golin will also be speaking at the Global Brand Forum.

He said that companies have to convince their consumers that the product or service they buy is real or authentic.

For Asian companies wanting to compete with longer, more established competitive brands in the marketplace, PR efforts will need to focus on reinforcing an image of 'quality' among Asian companies. Still, Asian companies may see the tide turning in their favour.

Mr Golin said there is an increasing awareness of 'everything Asian' in the West - the Olympics will help - which the Asian firms should capitalise on.

There is an opportunity to combine a balance of their Asian origins and romance with modern marketing techniques to tell their stories around the world, he said.

Marriage on a budget

2008-07-06T21:48:00.001-07:00

For all who are interested to get the most out of your penny...

An alternative to OIL?

2008-07-06T05:16:00.001-07:00

Companies around the world may be on a gold rush. Alot of them are onto Cow manure, algae, soalr energy, hydrogen ... one of these technologies, once deployed, could change the world.

Available Help for Small and Medium Enterprise

2008-06-11T06:32:00.001-07:00

Scheme helps local firm exploit new technologies

2008-06-04T09:38:00.000-07:00

Scheme helps local firms exploit new technologies

I read about the launch of the Exploit-IP programme recently. How does the programme work? What is the criteria and how do we apply for it?

The Exploit-IP programme is a government-funded initiative to encourage local enterprises to harness and license new technologies to develop innovative products and services to compete in the global market.

The programme features an interactive one-stop portal (www.exploit-IP.com) for companies to source for new technologies from an international network of technology partners, including renowned universities, research and development organisations, and multinational corporations (MNCs).

Technologies are classified in distinct categories such as infocomm, media, materials, chemicals, food processing, energy, environment, manufacturing, logistics, electronics and health care, among others.

The programme is managed by a team of technology and licensing professionals who have experience in technology licensing and commercialisation.

Any Singapore-registered company wishing to join the programme can do so at www.exploit-IP.com

Annual membership fee is currently waived. E-mail queries to szetl@exploit-IP.com

I run a small retail business. How can I implement standards when I cannot afford to hire a consultant?

Spring Singapore's Standards Implementation for Productivity (SIP) initiative helps companies implement Singapore Standards, international standards (for example, ISO standards) or consortia standards (for example, RosettaNet standards).

SIP projects can be initiated by a group of Singapore-based enterprises, which can either be small and medium-sized enterprises (SMEs), MNCs or large local companies with their SMEs partners, which intend to improve productivity by adopting voluntary standards.

The minimum number of companies participating in a project is three.

Partial funding for SIP projects is available to help SMEs defray costs incurred in standards implementation through the engagement of an external consultant for a pre-determined period.

More information on SIP projects can be found at www.spring.gov.sg

For inquiries, please visit www.business.gov.sg or e-mail enterpriseone@spring.gov.sg

Wrong way of creating wealth?

2008-06-03T04:04:00.000-07:00

June 3, 2008

Rental firms 'leasing' cars from cash-strapped owners. They pay owners' loan instalments and use cars as rentals - but this is illegal
By Christopher Tan, Senior Correspondent

AGAINST THE LAW: On the surface, it looks like a good deal. But it is illegal to rent your car out in this way. Also, if something happens to the car, there may not be any insurance cover.

COMPANIES which offer financially strapped car owners a way out - by taking over their vehicles to be used as rentals - are sprouting. It makes good business sense for the dozen or so firms, which advertise their services online - they avoid the huge capital outlay of acquiring their own car fleet.

On the surface, it looks like a good deal for the car owners too. Many of them cannot sell their cars due to their huge loans and the fall in car prices in recent years. The 'rental' firms pay them a monthly fee for their cars, often enough to cover their loan instalments.

But there is a catch - a costly one. It is illegal to rent your car out this way.

If something happens to the car while it is hired out, there may not be any insurance cover. If it is stolen, insurers may not pay up.

The rules and penalties

Private car owners are allowed to rent their cars out only from 7pm on Friday to 7am the following Monday and from 7pm on the eve of a public holiday to 7am on the first working day following the public holiday.

For illegally renting out cars, both car owners and rental companies face fines of up to $1,000, jail terms of up to three months or both. Car owners also risk a driving ban of up to 12 months.
'Leased' car missing - now owner faces bankruptcy

CASH-STRAPPED businessman Lau Cheun Kee 'leased' his 2004 Honda Odyssey seven-seater to a rental firm when his food business failed last year.But he now faces a bigger problem: involuntary bankruptcy and possible prosecution by the Land Transport Authority.

A check by The Straits Times found several advertisements on a website, efair.com.sg, targeting individuals who cannot quite afford the car they bought.

An ad by Xtreme Car Rental read: 'Having problems to upkeep your current car? Wanted (sic) to sell away car but can't sell due to huge cash top-up?I can solve all your problems and I have help (sic) a lot of car owners.'

Another promised to not only take care of monthly instalments, but also give 'cash rebates'.All the owner needed to do was to leave the car with it, a 'licensed car rental company in Singapore'.

One ad by a Mr Ricky Soh was more direct: 'Are you having any difficulties in servicing your monthly instalment? No worries! Do e-mail me your car model, monthly instalment...and we can work it out for you.'

What these firms are doing is against Land Transport Authority (LTA) rules. 'Private car owners are not allowed to rent out their cars through rental companies,' its spokesman said.

They had to do so on their own - and only at certain times and on particular days of the week.
The LTA cracked down on six cases each in 2005 and 2006 and on 11 last year. There have already been six cases in the first four months of this year. Both car owners and rental firms face fines of up to $1,000, jail terms of up to three months or both. Car owners also risk a driving ban of up to 12 months.

Despite the penalties, trade sources say the practice is widespread.

'There are a lot of cases which go unreported,' said Mr Peter Chong, president of the Vehicle Rental Association, which represents over 30 rental firms controlling most of the rental fleet here.

Firms operating illegally do not need huge capital outlays to start up a fleet. They can reach out to consumers on a tight budget because they offer lower rates.

Mr Chong said that since many of these cars were not registered as rental cars, hirers may have no insurance cover in an accident.

'I've come across cases where insurers refuse to pay up because the vehicle was not a rental car,' he said. 'That's the danger.'

The LTA said it takes a serious view of illegal rentals, and is 'consistently taking action against those who fail to comply with the law''.
Source: The Straits Times

Approved Home Typed Business in Singapore!

2008-04-30T09:13:00.000-07:00

30th April 2008

I HEARD that the Home Office Scheme is now extended to five years. But What businesses can I run from home?

Examples of businesses that are permitted under the Home Office Scheme include: Accountancy Services, Architectural Services, Consultancy Services (Business) , Consultancy Services (Engineering), Consultancy Services (Information Technology/Management)
Consultancy Services (Education), Design/Advertising Services, Transportation Services, Estate Agency,Insurance/Financial Planning Services, Technology based and knowledge intensive business, Trading Office.

Owners, tenants, authorised occupiers and subtenants of HDB flats, who are 21 years old and above, are eligible to apply under the scheme. The business should be registered with the Accounting and Corporate Regulatory Authority unless it is exempted from registration under the Business Registration Act. The business should also comply with the regulations of other government authorities and relevant licences/approvals must be obtained before the commencement of business.

To search for the licences/approvals that may be required for the business, please use the Online Business Licensing Service at the EnterpriseOne portal www.business.gov.sg

Source : Straits Times

He saves $16 K of of $20 K each month

2008-03-16T00:23:00.000-07:00

March 16, 2008

ME & MY MONEY: He saves $16k out of his $20k pay each month

Financial adviser Eugene Soo makes regular investments and his unit trust portfolio reaps annual returns of 20%

By Lorna Tan, Finance Correspondent

MR EUGENE Soo, 26, has barely worked for two years since graduating from Nanyang Technological University (NTU) with a degree in business administration in 2006. But he is already earning an income that is surely the envy of both young as well as old graduates.

A licensed financial adviser representative with Professional Investment Advisory Services, his gross monthly income exceeds $20,000 a month. This includes his own sales commissions and overriding commissions of his team of 40 advisory representatives.

His interest in the field of personal finance was ignited when he signed up for a banking and finance diploma at Nanyang Polytechnic and found himself topping his cohort in the first year.

'I found out that I was inclined towards finance and numbers...and that spurred my interest in investing,' he recalled.

At NTU, he was the president of its Investment Interactive Club where he had a hand in organising talks and competitions to improve the financial literacy of students. Before long, he was itching to join the real world of investing and eventually took the plunge in his final year at the university by joining a financial advisory firm as an advisory representative.

That year, he qualified for the Million Dollar Round Table - an international, independent association of the world's most successful life insurance and financial services professionals - and was earning $8,000 to $10,000 a month. This was on top of his other income from giving tuition and running a mobile motorbike washing business which he had set up in his polytechnic days. He joined his current firm in September last year.

'I enjoy what I do. Helping people to grow their finances and giving them advice gives me satisfaction and drives me to want to excel,' he said.

His advice to young people is that they should start planning early as the most important factor in growing one's wealth is not how much you have, but how long you have to grow your money.

'Make it a habit to save and the desire to own something, be it an asset, material stuff, or your dreams. Aim for something in life. Never wait for an emergency before realising the importance of planning early,' he said.

Q What are your money habits?

A I used to be a spender when I was in school and when I first started work. I spent almost all that I earned. I would save for something and one big purchase would wipe out my savings.

But I am now a saver and I save close to 80 per cent of my income for long-term goals. I pay cash most of the time and use credit cards only if there is an interest-free payment tied with the purchase.

Q What financial planning have you done for yourself?

A About 15 per cent of my investments are in investment-linked insurance products (ILPs), while 75 per cent are in a unit trust portfolio which I started in my polytechnic days. The balance is in stocks.

My unit trust portfolio comprises 100 per cent equities, mainly in commodities and Asia-Pacific funds. It is also mainly in high-risk sectors because I am building it on a long-term basis.
I monitor it on a weekly basis and it has generated an annual return of 20 per cent.

Q What about insurance planning?

A I have mainly term plans, a whole life plan and ILPs. I am covered for $500,000 on my life. Annual premiums come up to around $5,500.

Get a foundation plan like a whole life and enhance it with a term cover in your prime years. The advantage of a basic whole life plan is that it locks in the premiums at an early age and still gives a cash value when you surrender it in your later years.

Q What's your investment philosophy?

A I believe in dollar-cost averaging over a long period of time. I have been in the market since my polytechnic days and have been pumping in regular investment amounts using my salary from part-time work.

Over the past few years, there were many uncertainties and events that adversely impacted the returns of my portfolio. But by constantly investing into the market, I was able to average out my cost as I am able to buy equities more cheaply when the markets are down.

Overall, this helped me to achieve decent positive returns that outdo the returns of savings accounts.

Q What businesses have you gone into?

A I have a passion for motorbikes, which was how I got the idea for a mobile motorbike washing business. This was set up during my polytechnic days and it generated close to $6,000 a month, excluding exam periods.

I went to condominiums and offered washing, waxing and polishing services to motorbike owners. Now, I still get assignments from clients, which I pass on to my friends. I intend to expand the business once I find time off from my busy schedule.

I have also bought and sold motorbikes. It started out quite by accident when I was surfing the Internet and saw a cheap buy. I spotted the opportunity and made the transaction. It is possible to make up to 40 per cent profit, which amounts to about $2,500 a bike from such transactions.

When at NTU, I ventured into event planning, such as organising company dinners, which was very lucrative. The business involved securing deals and coordinating with different suppliers.

Q Moneywise, what were your growing-up years like?

A I live in a four-room flat in Aljunied with my parents and sister. My father is a stockbroker, and when I was young, I witnessed how exciting watching the daily teletext could be. My mum is a housewife.

I was taught from a young age to earn money to get the things that I wanted. I did not have many toys or video games and most of the items were hand-me-downs from an older cousin.
My mum, who is a saver, used to take me to different banks every week just to deposit $10 or $20 into my accounts. 'Without $10, you think you will have $100?' she always said.

Q What's your retirement plan?

A I intend to retire before 50 and achieve a passive income of $20,000 a month. I hope to own properties in Australia and travel there often to relax.

My nest egg will be a lump sum of money invested into different asset classes such as properties for rental income, shares, unit trusts and a high guaranteed single premium plan.

Q And your car is...?

A A white Honda Integra. I bought it just before I graduated from NTU with my own money.

Commodities Spiral

2008-03-15T21:15:00.000-07:00

March 15, 2008

Commodities price spiral: What next? How did it come to this?
As fears over a recession in the United States deepen, investors have been dumping the US dollar and US dollar-denominated investments and switching to other investments.

One of these is gold, always seen as a 'safe haven' for investors. It cruised past the historic US$1,000-an-ounce barrier this week.

Another big investment theme is commodities. Red-hot economic growth in Asia and elsewhere in the world has also meant rising demand for oil, precious metals and agricultural produce.

As investors pile more money into commodities, prices rise even further. Just this week, for example, crude oil hit an unheard-of US$111 (S$154) per barrel.

How high will prices go?

Do not ask the analysts. These days, most are reluctant to hazard a guess. This is especially so given the uncertain global economic environment and the continued financial upheaval in the US.

United Overseas Bank economist Ho Woei Chen believes demand for crude oil, diesel and petrol will fall as companies and consumers try to cut costs. But she is not about to forecast the next price threshold.

'Previously, the breaking point for oil was US$100 per barrel and when we went past that, everything kept on moving...so it's very difficult to say where the ultimate threshold might be,' she said.

Mr Bill O'Neill, a managing partner at commodity research house Logic Advisors, expects gold to rise to US$1,100 an ounce in light of the US dollar's continued woes.

How is this affecting people? Consumers hit by higher prices may cut back or switch to cheaper alternatives.

For example, motorists here bought less petrol this year despite the car population growing by 17.5 per cent. Some have switched to lower, cheaper grades of petrol.

Savvy investors are cashing in on the commodities boom. Some are putting their money in gold certificates and unit trusts that invest in commodities, or stocks directly linked to the commodities boom.

Some people are still taking it all in stride. A Straits Times poll of about 30 people showed that most will continue drinking coffee, never mind the price rises.

Source: The Straits Times

Looking for a room to rent?

2008-02-02T19:20:00.000-08:00

Looking for a room to rent? Try ex-army camp - Singapore

Two former barracks redeveloped as hostels to meet housing crunch caused by surge in number of foreigners here

WHEN rent for engineering student Wu He Kun and his three friends got too high, they turned to a former army camp instead.

From paying $1,600 a month for a three-room flat in Commonwealth, the four China students now shell out just $1,000 a month for a two-room hostel in the former Singapore Civil Defence Force camp in Jalan Bahar.

The housing crunch in Singapore, due to a boom in the number of foreigners living here, has caused the Singapore Land Authority to open up two former military barracks in the last six months to be used as hostels. The number of foreigners here went up from 798,000 in 2005 to 875,500 in 2006.

Highlighting his problem, Mr Wu, 24, said: ‘I viewed so many flats online but the rents were all more than what they offer here,’ he said.

Property developers are also seeing the potential in making money from such alternative homes.

Last week, five hostel operators made bids for the former Ulu Pandan camp and the winning company, E M Services, won only after a bid which was 60 per cent above the valuation.

Fresh air a bonus‘I like the fresh air and open space here. This is something I don’t get back home.’ VIETNAMESE STUDENT THO NGUYEN, on the unit he rents at the former SCDF camp in Jalan BaharE M Services, which bid $122,725 of monthly rent, is planning to pump $5 million to transform the camp into a full-facility student hostel. The lease is renewable on terms till 2017.

When the Ulu Pandan hostel starts operations in June, these two former camps will house up to 1,800 foreign students in total.

For the Jalan Bahar site, Jian Yu Construction spent $7 million to spruce up the place including repainting and landscape works.

There are 360 units each between 420 and 500 sq ft, with a kitchen, toilet and living room. The rent ranges from $700 to $1,100.

The hostel opened last July and now houses close to 900 foreign students.

Vietnamese student Tho Nguyen, 16, is now paying $500 for a unit he shares with two others. The Informatics student has been here since last September.

‘I like the fresh air and open space here,’ he said. ‘This is something I don’t get back home.’
The third camp tenanted out was the old police hostel in Cantonment which was converted into Pearl’s Hill Hostel in 2004.

Vita Group pumped in $1.5 million on renovations, alterations, retrofitting and furniture to turn the old building into a hostel.

With its central location, 85 per cent of its 142 units were snapped up by foreign students in the first six months of operation.

Bangladeshi trainee doctor Fetama Yasmin, 39, pays $650 monthly for a room she shares with another. She works at the Singapore General Hospital nearby.

‘Sometimes, I even take a 20-minute walk to work and save on transport,’ she said.

Source : Straits Times - 03 Feb 2008

Me and My Money

2008-01-20T03:02:00.000-08:00

Jan 20, 2008

ME & MY MONEY

She builds portfolio to reduce reliance on salary
Local advisory firm's director manages annual returns of around 20% on her investments
By Lorna Tan, Finance Correspondent

GROWING up as the eldest child in a not so well-to-do family of five, Dr Rachael Tay, 37, realised quickly that one way up the ladder of success was through education.

That conviction has already paid out healthy dividends for her. Dr Tay has been a director at GYC Financial Advisory since 2004.

As a youngster, she made a second key decision: To study overseas and broaden her horizons. 'I wanted an overseas education to see the world and obtain a broader perspective. And I knew the only way I could venture abroad was through a scholarship,' she recalled in an interview with The Sunday Times.

A former CHIJ St Nicholas Girls' School and Hwa Chong Junior College student, Dr Tay did just that. She won a scholarship from Singapore Technologies (ST) to study engineering at Imperial College London.

There she accomplished the great feat of winning a fellowship bursary and industrial sponsorship to do a fully-paid PhD in Materials Science - Advanced Metallurgy with no bond attached. She did the course right after completing her Bachelor of Engineering degree.

While serving her six-year bond at ST as a business development manager, Dr Tay found herself involved in the world of corporate finance.

This was one of the key factors for her switch to the financial advisory sector in 2004, which was when GYC obtained its financial advisory licence.

'I liked the idea of joining a smaller firm as a pioneer. My contributions are direct and I can see the fruits of my labour. I also can foresee building a financial advisory career for life,' said Dr Tay, who heads corporate financial services and investments at GYC.

When in Britain, she met her future husband, Mr Dave Wilkins, 36, who is a management consultant with DPI. They have been married for over 11 years and have three daughters - Hannah, nine, Abigail, seven, and Kirsten, 17 months.

Q What are your money habits?

A I have always been a saver. Perhaps because of my upbringing, I am conditioned to save and not spend beyond my means.

I save 30 per cent to 40 per cent of my monthly salary, which is channelled into a unit trust portfolio monthly. I make sure I have six months' provision for expenses sitting in my bank account and the money market.

Q What financial planning have you done for yourself?

A My equity investments are split approximately 40 per cent in stocks and 60 per cent in unit trusts. I have sold all my United States stocks as I have been bearish on the greenback since four years ago.

My stock portfolio was structured mainly for dividend yields. It comprises 10 counters such as ST Engineering, Ascendas Real Estate Investment Trust (Reit), Suntec Reit and Mapletree Logistics Trust.

I now take a longer term view on my own investments and tend to tinker much less, leaving the disciplined approach GYC has developed to do its job.

My primary strategy is now buy and hold, and rebalance once a year. Over the past five years, my investments have averaged annual returns close to 20 per cent.

Q What about insurance planning?

A When our first child was born, we bought our first life insurance policies. We had already decided on investment-linked plans for the high sum assured and investment element. We also got hospital and surgical insurance.

I was a novice investor then so for part of our children's education planning, we went with an education endowment. I am now kicking myself for accepting the low yield of such policies, and making up for it with investment portfolios for the children.

Now with three children, we have upped our life, disability, personal accident and critical illness cover to over half-a-million dollars each, and have also obtained full mortgage protection.
I am insured for $500,000 for critical illness and $650,000 for life. Our annual premiums amount to around $28,000.

Q How did you get interested in investing?

A I became interested in investing 10 years ago. I saw investing as a means of reducing one's dependence on a monthly pay cheque.

This was my starting premise. I started like many Singaporeans, putting money into the local stock market. I still remember vividly asking a colleague at the time, 'How do I open a Central Depository account?'.

I learnt how to long and short stocks. I later ventured into US and British markets, and also bought unit trusts. That was during a time of great mistrust - forgive the pun - in unit trusts, because many tech-themed ones were launched at sky-high valuations and they subsequently fell dramatically.

For me, unit trusts provided two advantages at the time: First, as I had to juggle looking after my children and work, I had precious little time to monitor my stock portfolio and needed convenient, diversified market access. Second, unit trusts allowed me to initiate a regular investment programme and practise dollar cost averaging.

Q Your best investment to date?

A My best investment would be a two-bedroom London Docklands apartment bought some time in 2000. It was marketed in Singapore and the purchase price was over £200,000 (S$560,400). We put a down payment of £20,000 on it. We sold it when its value doubled about nine months later.

Q What's your worst investment?

A My worst would be a dot.com US stock bought around the year 2000 during the days when price-earnings ratios temporarily became irrelevant. I have since written off the US$20,000 (S$28,600) investment as I would have had to pay more in brokerage than what I would get back today!

Q Any other investments?

A We have a modest 100-bottle wine collection more for drinking than investment purposes.
I have a six-figure sum invested in a venture capital fund and a private equity fund which will hopefully bear great returns in time to come, but I am not counting my eggs yet!

Q Moneywise, what were your growing-up years like?

A Growing up, my family of five was certainly not well to do, but neither did we starve.
Dad was the sole breadwinner as a factory supervisor and mum took in occasional seamstress work to supplement the family income. We were taught to be frugal and to spend only on necessities. Dad's hope for us was that the great enabler - education - would help us improve our lives.

Q Your home is...?

A We now live in a four-bedroom 2,000 sq ft condominium unit in Yio Chu Kang. It was purchased at $790,000 in end-2002 and is now worth about $1.3 million.

Q And your car is...?

A We drive a gold Nissan Presage.

Any One gearing for NEW Opportunities in the Coming Year?

2007-12-22T07:04:00.001-08:00

New Fine Dining Restaurant in Club Street, Singapore have the following positions:

1) Chef de Partie - $1,300 - $2,000 + meal allowance (2 positions)

2) Bar Supervisor - $1,600 + meal allowance (1 position)

3) Admin Assistantr - $1,300 - $1,600 + meal allowance (1 position)

4) Waiter/Waitress $1300- $1700 + meal allowance (Many positions)

A Photo of the restaurant is attached.- Open for PR and Singaporean only.- With experience will be good.- Student on holiday need not apply.- Able to start work immediate- Working hours Mon-Fri, 11.30am to 2.30pm, Mon-Sat, 6.30pm-10.30pmIf you are keen, pls send your resume to resume@starcareer.net with referral code: 1523JT.

Alternatively, go to: http://www.starcareer.net to take a look at other job opportunities.

Recycling Waste to Riches

2007-12-18T02:48:00.000-08:00

Any idea how to put waste to good use?? And to top that: turn that into a million dollar venture?

Well.. here's a basic idea how Enviro-Hub's plant works:

1. Mixed waste plastic is fed to a reactor to be melted at 350 deg C.

2. A special catalyst is added at controlled intervals, whereby a process called depolymerisation starts.

3. The catalyst 'cracks' the polymers of the waste plastic, producing three by-products: diesel, liquid petroleum gas and coke.

And this technology comes from India.. below is a story of how homegrown Singaporean Company turns waste into good money making opportunities...

AN EXCITING new use has been found for the annoying plastic waste that often washes up on beaches and clogs rubbish dumps: fuel. The waste management and recycling firm yesterday announced the construction of Singapore's first $50 million plastic-to-fuel plant - which converts waste plastic into useable fuels and gases.

Its executive chairman, Mr Raymond Ng, told The Straits Times that Enviro-Hub had been researching a long-term environmental solution for plastics since 2005. Success came only last month, when a pilot plant it built proved that the technology imported from India worked.

A special catalyst is added at controlled intervals, whereby a process called depolymerisation starts. The catalyst 'cracks' the polymers of the waste plastic, producing three by-products: diesel, liquid petroleum gas and coke.

Source: The Straits Times

A new form of wealth creation- Having Wines?

2007-12-16T00:58:00.000-08:00

NEW-GENERATION ASSETS: Intoxicating Investments

In the final instalment of a four-part weekly series featuring alternative investment options, GABRIEL CHEN explores the love affair that an increasing number of Singaporeans are having with premium wine

BLUE-CHIP WINES can earn investors annual returns of 10 to 12 per cent, if not more, because of the fairly limited supply. However, risks can be high too, especially for those who buy at a high price and pay hefty commissions to their brokers.

THE stock markets are volatile and property is starting to look a bit shaky, but Mr Andrew Soh is a happy man and quick to raise a glass to toast his own investing skills.
The real estate agent plonked his money into wine investments in 2005 and is now firmly in the red - and white and rose for that matter.

In fact, Mr Soh, 37, is having a vintage year, with paper gains of about 32 per cent after expenses are deducted.

His initial investment was about $80,000. After just a few months, he added another $120,000 worth of wine to his collection.

His portfolio - which includes premium French labels such as Chï¿½teau Lafite Rothschild and Chï¿½teau Latour - is now valued at about $300,000, says Mr Soh, a wine drinker himself.
If he were to liquidate his holdings, he would be sitting on a tidy profit of $64,000, after paying commissions of 12 per cent to his wine broker, Premium Liquid Assets.

Pay now, take delivery later

THERE is a wine futures market, or en primeur as it is better known in French, where people buy wine early.Buying en primeur means you buy futures in a wine hoping its quality and value will leap in later years. When you buy en primeur, you pay for the wines upfront, with the merchants' assurance that you will get the wine when it is released from the chateau or vineyard two years after the vintage.

Liquid assets

If Mr Soh were to liquidate his holdings - which include premium French labels such as Chateau Lafite Rothschild and Chateau Latour - he would be sitting on a tidy profit of $64,000.Not bad for someone who describes himself as a conservative investor.

Mr Soh, who has sunk 40 per cent of his investment portfolio into wine and the remainder into stocks and property, is just one member of a growing breed in Asia.

These new-breed investors enjoy drinking the wine while participating in the monetary returns it offers, says Premium Liquid Assets chief executive Eldric Ko.

The benefits are tempting. A portfolio of blue-chip wines can yield annual returns of 10 to 12 per cent, if not more, thanks to the relatively limited supply, experts say.

But wine investing involves various commissions and fees that can eat into gains. A broker can charge 5 to 12 per cent to buy and sell the wines, and there are also storage, insurance and shipping fees.

At one broker, Australian Wine Index, clients often invest at least $10,000, which covers shipping, insurance and three years of storage. Its wines from Down Under cost between $60 and $500 a bottle, and are stored at a temperature-controlled warehouse run by Cougar Express Logistics in Boon Lay Way.

The greatest risk, especially for alternative assets such as wine, is buying at too high a price, says investor Curtis Montgomery. Some of his 10,000 bottles are from Australia, but most are from the Bordeaux region in France.

'There are wine brokers who charge a large premium. An uninformed investor using such a broker might overpay significantly and have to wait many years to reap a profit,' says Mr Montgomery, whose portfolio is worth more than $2 million.

While commissions might be high, wine brokers now offer a service that used to be extended to old money only. They undertake the difficult and time-consuming task of analysing and recommending investment-grade wines.

Investors should pick brokers who have demonstrated their ability to sell wines and who have adequate exit strategies, backed by an international network of dealers, importers, traders and auction houses.

Investors who feel confident about investing on their own can buy wines from distributors such as Crystal Wines, Condale Consultants, Vinum and Grand Vin.

'The worst thing you can do is put the wine in your home cellar and watch the value fall,' says Mr Clinton Ang, the managing director of Hock Tong Bee, which has been in the wine and spirits trade for more than 60 years.

'It is not just about getting a 12-degree environment, but also about finding a facility that is recognised worldwide or one that is owned by a wine specialist that is recognised worldwide.'

Some private banks offer wine funds. SG Private Bank's Ultimate Wine Fund, which partners wine specialist Ficofi, invests in premium wine from Bordeaux, but to get on board, you must have at least US$300,000 (S$432,840).

Mr Tommy Lam, who owns the Cafe de Amigo restaurant at Funan DigitaLife Mall, recommends that novice investors keep risks low by sticking to the most reputable wines in the best vintages.

'If you could always get your hand on first-growth Bordeaux, you would hardly lose any money,' said Mr Lam, who holds a wine MBA from Bordeaux Ecole de Management in France.

Wines fall into various classifications and most first-growth or premier cru wines come from Bordeaux. These include Chateau Lafite Rothschild, Chateau Haut-Brion, Chateau Mouton Rothschild, Chateau Latour, Chateau Margaux and Chateau d'Yquem.

Experts say another important factor is vintage, which refers to both the year the grapes were harvested and the wines made from those grapes. Warmer seasons will produce riper grapes and better wine, while a poor growing season can significantly lower a wine's quality.

Certain vintages are so poor that some regions might have no investment-grade wines for those years. Bordeaux faced this problem in 1991, 1992 and 1993, whereas vintages from there in 1990, 1995, 1996, 2000, 2003 and 2005 are outstanding, says Mr Montgomery.

The value of wines can also be dictated by renowned wine critics, such as Mr Robert Parker, Mr Jeremy Oliver and Mr James Halliday. For example, a perfect 100-point rating or one in the high 90s from Mr Parker could send the price of a wine soaring, even if it did not belong to the finest vintage.

'They are what the industry refer to as the litmus test of wine labels and vintages,' says Mr Dominic Sim, the chief executive of Universal Assets Group, a wine investment firm.

Singapore Shop Rents Rising FASTER in City Fringe..than Orchard

2007-12-13T23:24:00.000-08:00

Singapore Shop rents rising faster in city fringe, suburbs than in Orchard
Landlords enjoy good takings as demand spills over from prime belt

ORCHARD Road may be the epicentre of shopping buzz, but malls in quieter areas are coming into their own.Rents of shops on the city fringe and in suburban areas rose faster than those in the prime shopping belt in the October to December period, according to Knight Frank.

The property consultancy said the biggest increase in rents came from shopping malls on the fringe of Orchard Road, such as Tanglin Mall and Park Mall. Retail rents in this area climbed by 8.9 per cent in the quarter, thanks to a spillover from Orchard Road and a better tenant mix, said Knight Frank.

In contrast, rents of malls in Orchard Road proper - including Wisma Atria and Ngee Ann City - rose only 2.6 per cent. Suburban malls such as Tampines Mall and Jurong Point fell in between, with rents rising 5.8 per cent.

The main reason for this is rents in Orchard Road have already risen so much that any further increases will be quite small, said Knight Frank’s director of research and consultancy, Mr Nicholas Mak.

On the other hand, retail rents in suburban and fringe areas are starting from a lower base, so they will rise by more, he added.

Indeed, Knight Frank’s data shows that despite having the smallest rent increases, the central areas still have the highest rents, and vice versa.

In the heart of Orchard Road, average gross monthly rents have soared to double those of malls on the fringes. This is because over this year, rents in Orchard Road central have gone up the most. They rose by 17.2 per cent this year, almost double the 9.9 per cent rise in Orchard Road fringe malls. In suburban malls, retail rents rose just 7.5 per cent for the year.
But overall, it has been a good year for landlords of shopping malls islandwide.

They have raised rents by more than market experts had forecast, thanks to higher wages, a strong economy and a booming property market.

Islandwide, shop rents in well-located malls jumped by a better-than-expected 22.1 per cent for the whole year, said Knight Frank. Its report on retail rents analysed prime shop space of between 400 and 800 sq ft, typically located on the ground floor of malls, with good frontages.
But rent growth is expected to moderate next year to 10 to 15 per cent, it said. While retail sales and demand for shop space are likely to stay strong, new malls will open with 2.3 million sq ft of space. These include West Coast Plaza, Iluma at Bugis, Ion Orchard, Orchard Central and Jurong Point’s new wing.

‘Landlords who try to raise rentals in the later part of next year are likely to face stronger resistance from retailers,’ said Mr Mak.

This may come as a relief to retailers. One retailer, who asked not to be named, said she had to move a boutique out of Paragon last year when rents nearly doubled. Another outlet at Suntec City has had rents rise by 30 to 40 per cent.

‘We used to be making money at most of our shops, but now because of the rental increases we are only breaking even at some,’ she said.

‘We can handle rents rising to a certain point, but after that it is untenable.’

Source : Straits Times

Money Making 123

2007-12-11T17:57:00.000-08:00

The Basics of Moneymaking
by Ram Charan

Here's a question to test your prospects as a business leader: How does your company make money?

If you can't answer it, you're hardly alone. Many MBAs can't answer it. Many CFOs and vice presidents can't answer it. Experienced CEOs sometimes struggle to answer it.

What I'm testing with this question is your business acumen.

The Universals of Business

At the core of every successful business, from a global giant to a corner store, are the same fundamentals of moneymaking: cash, margin, velocity, return, and growth. And at the core of every successful business leader is an intuitive understanding of the relationships among them.
It's easy to think the basics of business are for beginners. Everyone knows what cash is, and that companies must make a profit.

But business acumen isn't about knowing definitions. It's about keeping the basics of
moneymaking in sharp focus and balancing them in a way that's healthy for the business.

When you have business acumen, you realize the importance of every job at every stage of your career. A mailroom clerk with business acumen knows that getting checks to the accounts receivable department more quickly will ease the company's cash flow. And a sales rep with business acumen knows that higher-margin products will increase the company's return.

Moneymaking Basics

As the complexity of your job increases, it's easy to lose sight of the fundamentals. If your business acumen doesn't develop, you can stumble -- focus too much on revenue growth and overlook cash, or focus too much on cash and overlook growth.

That's why you should never consider it beneath you to revisit the moneymaking basics. They should be front and center in your diagnosis and decision making in every job you have.
Here are the basics:

• Cash

No business survives long without it. You should know how much cash your business generates and how much cash it consumes.

What are the sources of it? What drains it? What's the timing of the inflows and outflows and how is it changing? More revenues (sales) often means more cash. But growing a business consumes cash. How fast can the company expand without straining its cash flow?

• Margin

When people talk about the bottom line, they generally mean net profit margin -- the money the company earns after paying all its expenses, interest, and taxes. But gross margin is important, too.

Gross margin -- the difference between a product's selling price and what it costs to make the product (the "costs of goods"), expressed as a percent of the selling price -- can signal important shifts in a business. When PC makers saw their 32 percent gross margins decline to 20, they knew (or should have known) the competitive landscape had changed.
You have to know how changes inside or outside the business affect gross margin. Are there new entrants in the market who are winning customers? A competitor who's found a clever way to reduce costs and prices? A change in the pricing power of suppliers?

• Velocity

Velocity refers to speed, turnover, or movement.
How much revenue do you turn over, or generate, for each dollar of inventory? If you have $1 million in inventory for the year and revenues of $10 million, your inventory velocity is 10. This tells you how fast you're moving raw materials through the factory, turning them into finished products, and moving those products off the shelf to customers. The faster, the better.
Service businesses can track velocity, too. For banks, velocity of equity -- how much revenue is generated per dollar of equity -- is a useful measure. The concept applies to every business.

• Return

Margin multiplied by velocity equals return. If your return is lower than your cost of capital, your business is likely to be in trouble. That's when shareholders get concerned.
How do you boost your return? See if you can boost your margin or increase your velocity -- or, better yet, both.

• Growth

Every business needs to grow to stay in business. How do you grow in a way that keeps the other aspects of moneymaking in balance? There's no formula -- people with business acumen figure it out.

Where Business Acumen Counts Most

Street vendors in villages around the world use business acumen every day. They have to -- their next meal often depends on it.

In companies, business acumen is crucial when the external world changes and there's a need to reposition the business.

Like when Hollywood studios started selling videocassettes directly to the public at the same time it sold them to video rental companies. That's when Blockbuster's rental business started to slide.

People wanted to buy movies, not just rent them, so Blockbuster started selling them. But the moneymaking was completely different.

Blockbuster was used to buying videocassettes on credit and making payments with the cash from renting them. Returns were high.

Selling videocassettes meant laying out the cash up front, holding lots of inventory, and waiting for the cash to come in when the videocassettes were sold. Cash flow, velocity, and return were all adversely affected.

Where Do You Want to Go?
You don't need business acumen to make a meaningful contribution to a business. But you'll need it to rise through the leadership ranks.

You can't acquire it at a seminar or in a quick read. You learn it by using it in real business situations.

Start now by applying it to your company. Ask for the numbers or pull them from the annual report. Precision isn't necessary -- knowing what to focus on is.

Lessons from Financial Trainer

2007-12-08T21:44:00.000-08:00

Dec 9, 2007

Financial trainer banks on experience from running six businesses
NowAsia founder, whose food business has proved most successful, also invests in stocks and property

By Lorna Tan, Finance Correspondent

MR ABUAYUBUL, 35, AND HIS WIFE, MADAM ZAHIRA BANU, 29, have invested in insurance plans for each of their three children - Muhammad Amzath Khan, seven, Aisya Shafika, six, and Muhammad Ahshik, 11 - with monthly premiums costing $100 per plan.

LIFE can present plenty of challenges but few people have dealt with ones so traumatic as those Mr Abuayubul Ansari faced 13 years ago.

Mr Abuayubul, now 35, was driving his parents from Johor Baru to Penang when their car hit the road divider and his parents were flung out. His father died on the spot and his mother three months later. Mr Abuayubul suffered back injuries but fortunately recovered after 20 days.

With four younger siblings, then aged seven to 19, to support and no relatives to turn to, he had to rely on himself to get their lives back on track.

His parents had been running a sundry shop business and had debts of a few thousand dollars.
Mr Abuayubul was then 22 and doing a diploma course in Singapore. He quit his studies and returned to Johor Baru where he sold nasi lemak. But one job was not enough. So he travelled daily to Singapore to work at Newton Hawker Centre for $40 a shift.

Mr Abuayubul, who has been dabbling in stocks since he was 19, had a stock portfolio worth almost $100,000, and with cash so desperately needed, he sold everything.
Things started improving. His food business expanded and he even managed to put a brother through medical school in Britain.

Before long, he was venturing into businesses such as sports accessories, gifts and books. He also bought shophouses in Johor Baru to rent out.

His strategy was partly influenced by wealth guru Robert Kiyosaki's concept of building passive income. But not all the six businesses he started turned to gold.

In 2003, he set up NowAsia, which trains people in entrepreneurship, financial literacy, personal development and Internet marketing.

Mr Abuayubul is head of the Young Entrepreneurs Club and vice-president of the Young Entrepreneurs Network of the Singapore Malay Chamber of Commerce and Industry.

Q What are your money habits?

A I had a very bad habit of never recording all my expenses. Now, my savings are always three months' worth of monthly expenses.

Q What financial planning have you done?

A I follow a formula I call the 'bucket system', something I learnt from wealth guru Anthony Robbins. I am a short-term, high-risk investor. About 30 per cent of my investments is channelled into the stock markets in Singapore and the United States - what I consider my short-term growth bucket - with returns of 5 to 20 per cent per annum.
I go for penny stocks such as Goldtron. I'm an active trader and I pick stocks that are in the top losses list and sell them fast. I'm able to generate an average of $2,000 a month.
Sixty per cent of my investments are in a few businesses that I started, with returns of about 20 per cent a year. The remaining 10 per cent of investments are in my long-term growth bucket, which comprises property investments including land.

Q What about insurance planning?

A In 1992, I bought a life policy that comes with a sum assured of RM1 million (S$433,000). It required me to pay premiums for only eight years. I also have an insurance plan for each of my three children with a monthly premium of $100 per plan.

Q What property investments do you have?

A I have property in Malaysia and India. I bought a few acres of land near Chennai for less than $10,000.
I have three double-storey shophouses in Johor Baru. The first was bought in 1994 and cost RM450,000. I'm renting it out for RM 3,800 a month. My food business is run from this shophouse and it is giving me a monthly income stream of RM4,000.
In 1995, I bought another shophouse for RM180,000; it is rented out for RM2,500. I bought my third shophouse for RM237,000 and it is rented out for RM2,500. I also have a house in Skudai Baru which I bought for RM60,000 in 1995 and is now worth RM200,000. I have a 1,000 sq ft apartment in Skudai that was bought for RM28,000 and is now worth RM60,000.

Q How did you get interested in investing?

A When I was helping to sell newspapers at my uncle's shop in Singapore after my O levels, there was an elderly man who would always come to the shop and read newspapers without buying them.

We started talking and he told me the back pages helped a lot of people to make money. Those were the stock listing pages and I insisted on learning about investing. I started by investing in a Clob share - one lot of Esso shares worth $2,300. In eight months, I had built a portfolio worth about $100,000 through contra trading.

Q What has been a bad investment?

A My worst investment was a double-storey shophouse in Malaysia which I bought for RM180,000 and sold for RM140,000.

Also, I lost about $70,000 in my sport accessories and gift shops.

Q Your best investment?

A I have attended many seminars and workshops on wealth building and self-development. I have invested more than $40,000 in attending different kinds of seminars. In return, I have learnt so many things that made me invest in a few businesses and also create new businesses.
I am a director of an interior design firm in Kuala Lumpur and a manpower agency in Johor Baru.

Q What's your retirement plan?

A I will retire only when I die. I enjoy what I am doing now. I want to travel and share my experiences with people, which I believe can have a positive impact on their lives.

Q And your home is...?

A I have a double-storey house in Johor Baru. In Singapore, I live in a rented 1,200 sq ft apartment in Red Hill.

Q And your car is...?

A My car is a BMW.T series - bus, MRT, walk and also taxi.

Source: The Straits Times

Coffee Shops fetches Record Price

2007-12-03T22:08:00.000-08:00

Dec 4, 2007

$12M: Coffee shop in Jurong fetches record price

A COFFEE shop in an HDB parking building has sold for a record-breaking $12 million.
The eatery called VariNice is just a stone's throw from the Jurong East MRT and bus interchange.

Its huge catchment area of residential blocks and business parks nearby makes it a prize location, said property analysts.

The eatery - which boasts 12 stalls selling a variety of food from duck rice, to seafood and western food - has been going for about 20 years.

It was sold off by the Government in the 1990s and changed hands again in 2000 for about $10 million.

Its latest buyer is well-known foodcourt operator Koufu, which runs 37 food and beverage outlets across Singapore.

Lianhe Wanbao reported yesterday that Koufu was believed to have paid $13 million for the premises, and is collecting $12,000 a month in rent from each stall.

But Koufu founder and managing director Pang Lim told The Straits Times last night that the price tag and rental were less than that. The firm paid about $12 million and collects monthly rent of $6,000 from each stall.

The sale price works out to $2,553 per square foot for the 4,700 sq ft premises - well above the old reported record set by an 8,000 sq ft coffee shop in Ang Mo Kio which sold for $17.8 million, or $2,225 psf, in 2004.

The payback period for Koufu's latest buy is about 13 to 14 years.

Mr Pang said the deal was its biggest purchase but added that it was a long-term investment.
'It was a high price, but we need good locations and in the long term, it'll be worth it,' said Mr Pang.

PropNex chief executive Mohamed Ismail told The Straits Times that the value of coffee shops depends purely on traffic. 'Good business locations will always command a premium,' he said.
Mr Nicholas Mak, head of research and consultancy at Knight Frank, said bullish market expectations paved the way for the record deal.

This was especially so as the recent slowdown in residential property has not touched the retail and food and beverage scene.

'This is likely to be few and far between, however,' he added, 'as few shops get transacted at such a high price.'

Earlier this year, a coffee shop in Block 501, Jurong West Street 51, sold for $9 million.

Three coffee shops - in Tampines, Yishun and Bukit Batok - are on the market for $15 million apiece with no takers to date.

Source: The Straits Times

New Ideas: Creating a Barter Exchange on the Web..Does it work?

2007-12-03T22:01:00.001-08:00

Dec 4, 2007

No cash, no sweat as firms swop goods online
More turning to online barter to save money and market products

SITTING PRETTY: Ms Daisy Leng, the owner of Beauty Reformings, caught on to the barter trade craze and saved $2,800 on advertising and computer software. -- ST PHOTO: ALAN LIM

BARTER, that age-old form of trade, is heating up here, with the Internet as a modern-day matchmaker. A multimillion-dollar business has mushroomed online for mainly small businesses to exchange goods and services.

Two online brokerages here raked in close to $4 million in transactions this year and membership is booming.

One member is beauty salon owner Daisy Leng, who this year saved $2,800 on advertising and computer software, which she paid for with her beauty products instead of cash.

'The savings are very important to a small setup like mine,' said Ms Leng, now a regular barter trader.

Another local set-up, accounting software company A2000 Solutions, saved $10,000 on printing by redeeming credits earned from selling accounting software in a barter trade.

Making a trade

TO START, locally registered companies sign up on the websites of the two online brokerages here - BarterXchange and Ozone Barter.To minimise fraud and scam, members' details are checked against the Accounting and Corporate Regulatory Authority's records.

Bartering helps companies save money, as they can use their products to earn credits to pay for their purchases, rather than coming up with cash up front.

There are two online barter brokerages in Singapore: BarterXchange, set up in 2003, and Ozone Barter, founded two years ago.

This year, BarterXchange saw its membership rise by 47 per cent to 250, with transactions worth over $2.5 million, compared to $1.4 million last year. And at 300 members, Ozone
Barter's current user base is more than triple last year's count. Its trade volume has reached almost $1 million, up from $180,000 last year.

Advertising and printing services and restaurant vouchers are the hottest items on the two exchanges. Other goods in demand include computer software, executive training and Web hosting.

Buyers and sellers use a medium of exchange called barter points. With each transaction, points are debited against the buyer's account and credited to the seller's account. Each point is equivalent to one Singapore dollar.

To earn points, Ms Leng sells beauty products and spa vouchers, which are often given away as corporate gifts. She recently acquired $2,000 worth of computer software from technology company NextLogic. Both firms met on Ozone Barter.

Ms Leng, who has 'sold' $5,000 worth of goods so far, admitted she was sceptical about online trading at first. But her fears of being cheated were allayed after networking sessions with fellow members, she said.

She added that bartering has also widened her reach, allowing people to sample her products without paying cash at first.

'When customers are happy, they will come to my shop and pay cash for more services,' she said.
NextLogic, which offers technology that allows companies to manage customer data, has had the same experience.

Said Mrs Dagmar Alexyova, founder of NextLogic: 'It is an excellent way for small companies to try out my product.

'When they buy an upgrade later, they can pay cash.'

Source: The Straits Times

Singapore Making its Mark in Saudi Arabia

2007-11-27T21:59:00.000-08:00

Nov 28, 2007

S'pore making its mark in Saudi Arabia
Local firms seizing lucrative opportunities in sectors such as infrastructure development

THE Singapore corporate footprint is being stamped slowly but surely on the deserts of oil mega-rich Saudi Arabia. And this process looks set to gather pace in the next few years, as more Singapore firms seize opportunities in a lucrative market that is, in effect, on the other side of Asia.

Singapore Airlines is believed to be the first local business to operate there - with its maiden flight in 1979. But other Singapore businesses have struck out there in recent years, too.
They include information technology firm CrimsonLogic, infrastructure service specialist Tiong Woon and property giant Keppel Land.

Saudi Arabian General Investment Authority's country director for Singapore, Mr Meshari Al-Khaled, said IE Singapore had worked with the Saudi authorities to promote the kingdom's newly-created economic cities.

Economic cities are development clusters set up by the authorities to focus on attracting new businesses to specific sectors. Singapore e-government solutions provider CrimsonLogic got a big boost in 2002 when it won a US$22 million (S$31.7 million) deal in Saudi Arabia to build, operate and maintain an e-trade project to serve the kingdom's trade sector. The deal has helped open more doors for CrimsonLogic in the Middle East, winning it more projects.

The e-trade project SaudiEDI is a joint project undertaken by CrimsonLogic and the kingdom's Public Investment Fund.

'They've showed a strong passion to implement things and are good listeners,' said Mr Faisal Saleh Al-Mousa, the general director of SaudiEDI.

Another local firm swiftly establishing its Saudi presence is Tiong Woon.

It is making inroads in Jubail Industrial City off the eastern coast - one of the world's largest petrochemical complexes.

In January, it became the first Singapore company to be awarded an investment licence to run a 100 per cent foreign-owned business entity in the kingdom.

And its business is booming. Tiong Woon's Saudi Arabia branch manager, Mr Jason Low, said demand for his firm's 60 cranes is almost at full capacity, and his major clients include South Korean firms.

He said: 'It's a happy problem we have as the demand increases. We aim to grow our fleet of cranes from 60 to 150 in two to three years.'

Another is Keppel Land.
In September, it announced its first foray into Saudi Arabia by inking a $760 million joint venture to develop 1,000 luxury homes in Jeddah's Corniche waterfront.

The Singapore presence is growing. Other Singapore firms active in Saudi Arabia include Rotary Engineering and Hyflux. Rotary has clinched an $11 million deal to provide support for an ethylene plant, while Hyflux is in a $45 million joint venture in a recycling plant.

Yesterday, SembCorp Marine announced a US$6.6 million joint venture for a shipyard in Yanbu, a city on the west coast of Saudi Arabia.

To help local companies seeking to do more business in Saudi Arabia, IE Singapore set up an office in Jeddah recently.

Said IE Singapore's centre director for Jeddah, Mr Nordin Yatim: 'Our business presence there is at an infant stage. It's a place with lots of untapped potential, with plenty of opportunities especially in infrastructure development, logistics and oil and gas support.'

Surviving Saudi Arabia

2007-11-27T21:40:00.000-08:00

Nov 28, 2007

Surviving the Saudi kingdom: Learn and adapt to customs

Its commercial capital, Jeddah, seems much like an American city, if not for its tight security and social rules, and yet the country is a land brimming with business opportunities

APART from the odd Charles & Keith shoe shop, there is not much to remind a Singaporean passing through Saudi Arabia of home.

If anything, the gleaming megamalls, posh car showrooms and fast-food joints lining both sides of the motorway make the kingdom's commercial capital - Jeddah - seem much like an American city.

However, the sight of women fully covered in black robes and restaurants split into singles and family sections quickly remind you that you are in Saudi Arabia, a land of tight security and social rules, but also one brimming with business opportunities.

Diversification is the buzzword as the kingdom seeks to lessen its economic dependence from oil and grow other sectors.

With over a quarter of the world's oil reserves and spanning 80 per cent of the Arabian peninsula, Saudi Arabia certainly cannot be ignored. Yet, it seems a mysterious land of untapped potential for most Singapore firms.

Economic hub

The crown jewel of Saudi Arabia's new economic strategy is the US$26.6 billion (S$38.3 billion) King Abdullah Economic City. It is the embodiment of the kingdom's drive for economic diversification and expansion. It is located 200km north of Jeddah on the west coast.

Facts and figures
LAND AREA :2.15 million sq km (roughly the size of Western Europe)

The key to success is being aware of the country's social and religious customs and adapting well to them. They can be disconcerting. The weekend is on Thursday and Friday, women cannot drive and there are no cinemas, no alcohol.

Security is tightest in the capital, Riyadh, most noticeably at government buildings and expatriate housing compounds. Armoured cars with mounted machine guns, high barbwire fences and multiple security checkpoints surrounding the entire housing estate perimeter are common fare.

Enter the compounds of the condominiums, and it is a whole different world. Most come equipped with their own grocery and laundry stores, sports facilities, and lush surroundings similar to a beach resort. Some are French-themed, with exotic street names such as Rue de Paris.

The Saudi Arabia branch manager of Tiong Woon, Mr Jason Low, said: 'It's like a mini-United Nations in compounds. You'll learn many interesting cultures and to get along with people from many countries.'

Overall, the wide income disparity in Saudi Arabia is obvious. On one hand, there are reports of a Saudi prince buying a US$475 million (S$685 million) A-380 superjumbo flying palace, and yet you can see the odd African child begging for money on the streets.

Perks
WHILE the rest of the world struggles with soaring petrol costs, Singaporeans in Saudi Arabia will bristle more at their water bills.

A litre of 95-octane petrol costs just 60 halala, or 23 Singapore cents. The same amount of drinking water costs about 1 Saudi riyal, or 39 Singapore cents.

Cars are also far cheaper. A new Honda Accord will set you back only 60,000 Saudi riyals.
Information technology technical manager Andrew Heng said: 'The money's good, cost of living's low.'

Singapore Airlines' Middle East general manager, Mr Mohamed Rafi, added: 'Living costs are comparatively lower here, due to no GST. In addition, personal income is not taxable.'

Speak to Singaporeans living in the country, and you will find a closely-knit bunch, with frequent dinner gatherings, morning coffee outings among the women, desert excursions and diving trips.

'The conservative culture in Saudi Arabia may provide an ideal place to bring up a young family,' said Singaporean medical scientist Kamal Jalil.

Renaissance
HOWEVER, others also say having to forego cinema trips and the occasional pub outing are social sacrifices they have to put up with.

A new era is dawning over the oil-dominated economy.

It faces demographic challenges - about 75 per cent of its 27 million population is below 30 years of age - and economic ones as it attempts to lessen its reliance on oil.

A key strategy is the building of multibillion-dollar economic cities - development clusters focusing on attracting new businesses to specific sectors.

And Singapore is welcome to jump on the potentially lucrative bandwagon, especially in sectors such as infrastructure development, logistics, and oil and gas support.

'We've about US$624 billion worth of economic projects to be done in the next 10 to 15 years,' said Dr Fahad Al Sultan, secretary-general of the Council of Saudi Chambers of Commerce and Industry.

Dr Hisham Jomah, Jeddah Municipality director of mega projects added: 'It's a fertile soil to plant your businesses... It's open in all directions.'

A recent World Bank report ranked Saudi Arabia 23rd among 178 economies for ease of doing business - up from 38th a year ago.

That placed it a rung above Malaysia and the highest in the Middle East.

Singapore was ranked No. 1 in the report.

Challenges

HOWEVER, there are several challenges. Common grouses include difficulty in acquiring visas for foreign workers, finding well-trained local talent and getting Singaporeans who are willing to be posted there. Temperature is also an issue - the mercury can rise above 50 degrees during summer.

Knowledge of Arabic is a bonus, especially when dealing with government offices. Most firms will hire a Saudi national as a government relations officer.

'If there's a legal dispute, you have to get a Saudi national to represent the company in court; you can't go in to state your case,' said a Singaporean working in the country.

Building bridges

RELATIONSHIPS are key to clinching corporate deals.

IE Singapore's centre director for Jeddah, Mr Nordin Yatim, said: 'Go for coffee or a shisha smoke with them, chit chat, develop mutual trust and confidence.'

Business is usually done over a lengthy meeting with several cups of Arabic coffee or a shisha smoke - part of the Saudi culture of providing warm hospitality.

'A humble, patient attitude is preferred. A high and mighty approach won't work,' said CrimsonLogic project director Jafarulah Khan.

A lot of Saudi businesses are family-run, and some rely on word of mouth in decision-making. Singapore's reputation is quickly gaining ground, and most Saudis hold it in high regard.

Singapore's Ambassador to Saudi Arabia V.P. Hirubalan said: 'The Singapore brand name has been buzzing around in Saudi Arabia and is catching on now more than ever. They see us as a success story.'

8 tips for the super shoppers

2007-11-21T09:21:00.000-08:00

8 Tips for the Savvy Shopper
Save hundreds on your holiday gifts with this checklist

Once you've created a gift list, clip these tips and follow them to make your shopping as hassle-free as possible:

1. TIME YOUR BUYING. Don't fall for Midnight Madness sales, which typically offer discounts on just a few products. Sales are first come, first served, which could mean hours of waiting. For "hot" gifts that might be in short supply, buy as soon as you see them. But consider waiting for others while discounts mount. Black Friday, the day after Thanksgiving, and the following Cyber Monday are the days when many merchants get serious about sales. You're likely to find online discounts, free standard shipping, or deferred interest payments. Shop in the early morning, when crowds tend to be light, and when retailer Web sites we scanned are especially inclined to offer special discounts.

2. GO ONLINE TO SAVE BIG. Use several shopping "bots" to compare product prices at dozens of retailers. Better-known bots include BizRate, DealTime, Google Product Search, MySimon, Shopping.com, Shopzilla, Amazon.com, and Yahoo Shopping. If possible, sort by product price. (Bots often put retailers that pay a fee at the top of the results list.) Download coupons at FatWallet and DealTaker.com. Those sites also provide advance information about sales at many stores and reveal which products come with rebates and which merchants offer free shipping. CouponCabin offers coupons plus discount or promotional codes, which boost savings. Store Web sites offer coupons and say what products are available at stores, so you won't waste a trip.

3. BE LEERY OF BANK GIFT CARDS. They're more likely to expire and tack on fees than cards offered by individual retailers. Some cards depreciate in value from month to month if unused. If you give a gift card, pass along the receipt, too, in case the card is lost.

4. GET A GIFT RECEIPT. If the recipient lacks a receipt, they may be issued a gift card or store credit for the lowest price the item ever sold for, not necessarily what you paid. They'll also need the receipt for warranty service. Purchases made in November and December are often eligible for extended return or exchange privileges.

5. BE SURE YOUR GIFT IS WANTED. A recipient returning electronics gear in an opened box might pay 10 to 15 percent of the purchase price as a restocking fee. Computer software, music CDs, and movie DVDs generally can't be returned or exchanged for another title once the seal is broken.

6. APPLY FOR REBATES. Four of 10 people eligible for rebates forget to collect the necessary paperwork, follow the wrong procedure, or wait too long to file. If you're entitled, act fast. You'll typically need the product serial number, a sticker or label,an original receipt, UPC code cut from the carton, and an official form. Rebates issued as debit cards, a growing trend, typically expire in 60 or 90 days.

7. AVOID PRIORITY SHIPPING. Using last year as a barometer, the deadline for free shipping from major retailers will expire about Dec. 18, though standard shipping might be possible for a day or two longer. Ordering one-day service can add $20 or more and doesn't guarantee delivery within 24 hours of clicking on "place order." The arrival date is calculated from the moment the package is shipped, so factor in two or three days of processing time.

8. SAY NO TO EXTENDED WARRANTIES. Most products don't break during the first three or four years of ownership. If breakage does occur, the repair cost is typically similar to the warranty cost. For added protection at no cost, buy with a credit card. You can extend the manufacturer's original warranty free for up to one year with most gold and platinum cards (check with the issuer).

Source: Yahoo

Grants for F and B business

2007-11-21T08:44:00.000-08:00

Nov 21, 2007

Grants for F&B business to help raise service standards

WHAT are some of the assistance programmes for the food and beverage (F&B) industry that I can apply for?

You can consider the Food and Beverage Capability Development Programme or the Customer-Centric Initiative for Food and Beverage.

The Capability Development Programme aims to help enterprises develop innovative concepts, products and processes that will raise efficiency and service levels.

Funding, which is on a case-by-case basis, extends up to 50 per cent of the qualifying costs of projects.

These include consultancy fees, salaries of employees involved in the project, cost of equipment, materials and consumables.

The Customer-Centric Initiative helps locally based businesses improve service levels and benchmark themselves against industry standards.

The projects could involve:
Mystery diner audits and customer satisfaction surveys;
Identify service gaps and implement improvements;
Post-implementation assessment of service; and
Certification under Singapore Service Class.
Businesses can use the service standards developed under the initiative to audit and measure their service levels.
Service standards are available for casual dining restaurants, and pubs and clubs.

Funding is on a case-by-case basis. Typically, the initiative will fund up to 50 per cent of the qualifying costs, which include:
Consultancy fees;
Workforce Skills Qualification training for employees;
Cost of equipment, materials and consumables; and
Cost of audit, assessment or certification.

Contact EnterpriseOne for more information.
Answers from EnterpriseOne. For more details, go to http://www.business.gov.sg/

Franchising as a means to create wealth

2007-11-21T08:42:00.000-08:00

Nov 21, 2007

Franchising a growing option for overseas expansion
Firms find it more feasible than direct investments, as it reduces business risk

KINDERGOLF was expanding fast, but it wanted to do so faster.

About three years ago, the firm, which teaches golf to children between the ages of two and seven, chose the franchising route to take its brand overseas.

The franchising option - licensing other entrepreneurs to use a firm's business template - is cheaper than pouring the company's own cash into expansion.

Back in 2004, revenues at the home-grown firm were growing at 20 per cent a year, on healthy demand for golf lessons.

Founder and chief executive Donna Lee was keen on the franchising concept, so the firm took the plunge with a United Square outlet, then went regional through franchised businesses in Indonesia and Malaysia.

'In terms of expansion, it reduces your capital outlay,' she says, as each franchisee pays its own way.

Typically, a franchised outlet will use the branding and products of the original business. The franchisor receives franchise fees from them. KinderGolf had three self- owned outlets before franchising. It now has 12 outlets - four self- owned and eight franchised.

Next year, it will add a franchised outlet in California, said Ms Lee, whose business has been growing by 30 per cent to 40 per cent a year since it embraced franchising.

Firms such as KinderGolf are now more keen on using franchisees to take their brands abroad, as opposed to expanding there themselves, a new survey has found.

Conducted by Franchising and Licensing Association of Singapore, Singapore Business Federation and FT Consulting, the survey has found that 77 per cent of 61 Singapore-based firms strongly agree or agree that franchising is more feasible for overseas business expansion than adding their own outlets.

The survey participants, mainly existing and potential franchisors, say franchising is a highly viable option for overseas business expansion, as it reduces the business risk of investing in a foreign market.

China was identified as the top country targeted for recruiting new franchisees within the next year. This was followed by India and the United Arab Emirates. Still, franchising has its challenges.

'You need to make sure you get the right franchisees,' said Mr Patrick Chai, chairman and chief executive of Blush!, the local lingerie retailer.

'Some franchisees hope to make a quick return and are not willing to follow your strategy to grow the business further,' he said.

'Then others do not have staying power, as maybe they do not have enough reserve capital,' he added.

Blush! has franchises in Singapore, Malaysia, Dubai, Indonesia and Macau.