1.3 D OING B USINESS IN S INGAPORE
1.3.5 HSIAS & IADSA
others, health supplements.12 Majlis Ugama Islama Singapura (MUIS) is the Singaporean body for dealing with Halal certification. Registration and processing of applications can be done through their homepage.13 Due to the need for Halal certification for Muslims to consume any product, this will be of importance for companies doing business in a multi-cultural country, like Singapore.
1.3.5 HSIAS & IADSA
The Health Supplements Industry Association Singapore (HSIAS) represents 90% of the companies in the Singaporean market. They are in constant contact with the government, and keep their members updated on regulations and general trends in the industry. Membership would be of great importance for Vigour, should they decide to enter Singapore. Registration form and information regarding HSIAS can be found in Appendix-1e.
The International Alliance of Dietary/Food Supplement Associations (IADSA) is an umbrella organization for trade associations like HSIAS when it comes to health supplements. This organization represents the views of the industry, referring to its members, regarding the development in health supplement policies and governmental regulations. (See Appendix-1f)
12 http://business.asiaone.com/Business/News/SME%2BCentral/Story/A1Story20080125-46596.html (entered 16.03.08)
13 http://www.muis.gov.sg/cms/services/hal.aspx?id=210 (entered 16.03.08)
10 1.3.6 GST
Despite the trade- and free trade agreements, companies exporting to Singapore need to be aware of the Goods & Services Tax (GST), currently at 7%. This is a tax on domestic consumption.
1.3.7 Regulatory framework
Regarding the regulatory framework, the Health Science Authority (HSA) provides guidelines for health supplements. These guidelines will be discussed in Chapter 5.
In short, these guidelines exist because there are no requirements for pre-market approval or licensing for such products. Companies can get their products classified, through the Health Sciences Authority, by submitting an enquiry form. (See Appendix-1g)
The previous discussion reveals Singapore as an attractive market to do business in, with a stable economy and a pro-business government. This is supported by the World Bank who has ranked Singapore as number 1, with regards to ease of doing business. We will explore Singapore more in the external analysis in Chapter 5.
In general, the above mentioned tasks will mostly be performed by the Singaporean importer should the company decide only to export from Norway, thus not being its own importer.
Chapter 2 –
Research Methodology
11 Chapter 2
Research Methodology and Analysis
In the following chapter we will describe how we have conducted our research. Firstly, we will describe the collection of data, problem definition and the research objectives. Secondly, we will go through the research design and the sampling procedures. Thirdly, we will
illustrate how we went forward with the questionnaire, the collection of data and the analysis of the data. Lastly we will explain the limitations of the data followed by our conclusion.
2.1 Collection of Data
We have derived information from both secondary and primary data.
2.1.1 Secondary data
In our secondary data research we have used journals, books, the Internet and reports as sources for retrieving information.
2.1.2 Primary data
We found primary data collection necessary when we could not find the data needed in secondary sources. In our research we have made use of both qualitative and quantitative research for deriving information. With regards to the quantitative research we made use of a questionnaire while in the qualitative research an in-depth interview was conducted. We will first elaborate on the methodology for the quantitative research and thereafter go through the
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qualitative research. Figure 2.1, depicts the various stages of the research process which will be discussed in this chapter.
Figure 2.1: Research Methodology
2.1.3 Problem Definition
In collaboration with Vigour we developed the following problem definition:
How do Singaporean consumers perceive healthcare products containing seaweed and Norway in general? If the analysis suggests that there is a market in Singapore, how should Vigour proceed with particular reference to entry strategy and distribution channels?
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Our objective was to detect whether there was any market potential for Vigour in Singapore.
By providing answers to these questions we could draw certain conclusions about the Singaporean market and give necessary strategic recommendations to Vigour.
2.1.4 Research Objective
The main objective of the consumer questionnaire was to detect the level of interest among consumers in Singapore about health supplements that contain seaweed, and in what kind of retail outlet they would consider purchasing the product. An additional aim was to examine whether the country of origin would have any effect on the consumer’s decision.
2.1.5 Research Questions
To reach our objectives, a set of research questions were developed that would keep us focused and additionally would shape the final questionnaire.
• What are the consumer’s perceptions and knowledge of health supplements containing seaweed?
• What do the consumers like to achieve by using health supplements and what is the regularity of usage?
• Is there interest among the consumers to try health supplements that contains seaweed?
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• In what kind of sales outlet would the consumers consider buying the product and for what price?
• What are the consumer’s perceptions and associations of Norway and Arctic Norway respectively?
2.1.6 Research Design
It was determined that the most suitable design to apply in this research was a descriptive design. A descriptive design in the form of a questionnaire would provide us with the quantitative data we needed to achieve our research objectives and derive some
understanding of the Singaporean market. Furthermore, a questionnaire would also provide us with useful information about consumers and their preferences with regards to health supplements containing seaweed in particular. Due to the nature of the assignment, we did not find it appropriate to generate a hypothesis.
2.1.7 Sampling Procedures
The target population for the questionnaire was both Singaporean and non-Singaporean residents over 20 years old. To be able to derive sufficient information regarding the population, the sample frame was set to 300 respondents. The samples were collected through convenience sampling.
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2.1.8 Questionnaire Design
When designing our questionnaire we used the guidelines provided by Dr. Burgess.14 The survey consists of 22 questions. These questions are based on findings in the secondary data as well as requests from Vigour, and lastly in cooperation with our supervisor. A copy of the questionnaire can be found in Appendix-2a.
The questions developed in the questionnaire were intended to answer the research questions.
• Research question 1: was answered by questionnaire question 10, 13, 14 and 19.
• Research question 2: was answered by questionnaire question 9, 8, 11, 12 and 15.
• Research question 3: was answered by questionnaire question 16.
• Research question 4: was answered by questionnaire question 17 and 18.
• Research question 5: was answered by questionnaire question 20 and 21.
The questions were designed to be easy to understand. We arranged the questions so that the personal data questions would come first. This served two purposes, firstly we had decided to exclude people under the age of 20 and this allowed us to do so in an efficient manner.
Secondly, the personal data questions served as a method to prepare the respondents.
Hopefully, this would allow the respondents to get familiar with the questionnaire before the more difficult questions started.
14 http://www.leeds.ac.uk/iss/documentation/top/top2.pdf (entered 29.01.08)
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We designed our questionnaire with Fixed-Alternative Questions which provided us with the possibility of comparing, tabulating and ultimately interpreting the data. However, in a number of questions the respondents were given the possibility to add comments.
Furthermore, different scales were applied in the questionnaire, simple-dichotomy questions and attitude rating scale, where we made use of the Likert Scale.
2.1.9 Pretest of Questionnaire
Firstly, we conducted an in-class pretest on the questions regarding the perceptions of Norway. This was due to the fact that we were curious if we had captured all the relevant options. We found that there were some minor changes we had to make in order to proceed.
Secondly, the first proper pretesting was conducted using a convenience sampling method.
20 random people in Orchard Road were asked to fill out the questionnaire. The aim of the pretest was to detect possible questionnaire problems. We encountered some minor problems with a few of the questions which were revised.
Thirdly, to ensure that the revised questions were in order, a second pre-test was conducted.
After this, the questionnaire was judged to be ready.
2.1.10 Data Collection
The respondents for the questionnaire were approached at Orchard Road, Marina Bay, Holland Village and Singapore Conference Center at Suntec City in early March, 2008. We chose to distribute the questionnaire in these areas due to the high presence of young
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professionals and other relevant segments. The respondents were asked either face-to-face or by a self administrated method. Due to our presence we were able to clarify any inquiries the respondents had and in addition make sure that all of the questionnaires were completed. The collection of the 300 questionnaires was completed within 2 days.
2.1.11 Data analysis
Excel and SPSS were used in order to process the data and give us relevant information.
Excel was used in order to enter the raw data and make tables. This was done for practical reasons. In SPSS we ran descriptive tests as well as cross-tabulations. This will be returned to and elaborated on in Chapter 3.
2.2 Limitations
Firstly, we faced time constraints during the development of the questionnaire when this was more time consuming than expected. Secondly, we are aware that sampling errors have occurred. For example 85.5% of the respondents are under the age of 39 years old.
Furthermore, we experienced some difficulties with the question regarding occupation when 48.6% of the respondents answered “other” as their occupation. Therefore we cannot draw any conclusion on the basis of the respondent’s income. The sampling errors could cause problems at some stage in the analysis because the standard deviations are incorrect. There will also be differences in confidence intervals. We tried to limit the sampling errors by having a fairly big sample size. Thirdly, it is a disadvantage that we used a non-probability
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sampling, more specifically convenience sampling-technique, which reduces the ability to generalize upon the results. If we had more time we could have distributed the questionnaires at more locations which would have allowed us to obtain a more diverse set of respondents.
Fourthly, a response bias might have occurred if the respondents did not feel comfortable with answering us truthfully when interviewing them face-to-face. Lastly, some
administrative errors occurred when entering the raw data. The obvious errors were corrected, but when entering the data manually there is a possibility that errors occur. All these are possible limitations of the research, and may affect the validity and the reliability of the results, and the conclusions drawn from them. Nevertheless, the data collected was judged sufficient for the purpose of the exercise.
Chapter 3 –
Analysis
19 Chapter 3
Data Analysis
3.1 Sample
Initially, 300 questionnaires were distributed, but due to errors in 9 of them, the data was gathered from 291 questionnaires. All the data frequencies and other analyses can be viewed in Appendix-3a.
3.2 Preparing the data
Before conducting any analysis we had to clean the data for extreme and missing values.
Furthermore we needed to re-categorize the data due to some of the questions having the possibility for multiple answers. This was done by treating them as individual questions and giving them the value 1 for “yes” and 0 for “no”.
3.3 Frequencies
In order to get a better understanding of the level of interest and attitudes among the
consumers, and the preferred retail outlets, we ran a descriptive - frequencies analysis. Some of the most interesting results, that will answer the research questions, will be presented in the summary of findings.
20 Knowledge
The figure below shows that 64% do not know that there exist health supplements that contain seaweed while 36% are aware of products of this kind.
Figure 3.1: Knowledge regarding seaweed supplements
As Figure 3.2 shows, 47% of the respondents agree that health supplements have a positive effect on their overall health. 41% of the respondents state that they are neutral about whether health supplements have a positive effect on their health. The fact that almost half of the respondents are neutral makes the results less distinctive. On the other hand, only 3% of the respondents disagree with the fact that health supplements have a positive effect on their health.
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Figure 3.2: Attitudes towards health supplements effect on health
Usage
The chart below shows that 54% of the respondents have used health supplements. On the other hand, 46% of the respondents state that they have never tried health supplements.
Figure 3.3: Use of health supplements
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The table below shows that 47% of the respondents do not use health supplements at the present. Furthermore, 19% state that they use health supplements 7 days a week. Lastly, 34%
of the respondents use health supplements 1-6 days a week.
Figure 3.4: Regularity of use of health supplements
Achievement
The chart below shows that 57% of the respondents would like to achieve better health by using health supplements. 19% would like to achieve more energy while 12% would prefer achieving a detoxification.
23 Figure 3.5: Reasons for using health supplement
Price and Place
The chart below shows that 69% of the respondents state that they are neutral when it comes to the level of interest in actually purchasing a health supplement containing seaweed. Due to the large number of neutral respondents, it will be hard to draw a conclusion based on this chart. On the other hand, 20% state that they agree while 1% strongly agree and are therefore interested in making such a purchase.
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Figure 3.6: Interest in buying health supplements with seaweed
As seen below, 44% of the respondents would prefer purchasing their health supplements at pharmacies while 36% would prefer health food stores. Furthermore, only 4% of the
respondents would like purchasing health supplements online.
Figure 3.7: Preferences regarding retail outlets
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With regards to price, 37% of the respondents are willing to pay S$20-29 for a month’s supply of health supplements containing seaweed. In addition, 31% would pay S$10-19 for a month’s supply. Only 8% would be willing to pay more than S$40 for a product of this kind.
Figure 3.8: Price prepared to pay
Perception of Norway and Arctic Norway
Questions 20 and 21 in the questionnaire were intended to detect the respondent’s potential associations of Norway and Arctic Norway. As the chart below shows, 39% of the
respondents do not have any perceptions regarding Norway while 34% associate Norway with salmon. Furthermore, 15% associate Norway with nature.
26 Figure 3.9: Perceptions regarding Norway
With regards to Arctic Norway, 39% of the respondents have no associations while 33%
believe it is cold. In addition, 17% think Arctic Norway has a clean environment.
Figure 3.10: Perceptions regarding Arctic Norway
27 3.4 Cross-Tabulation
Cross-tabulation is used in order to inspect the differences among groups and to make comparison, it is a joint frequency distribution of observations on two or more sets of variables15.
Firstly, in order to better understand the appropriate target audience and segments, a cross-tabulation on age, usage and marital status was conducted. The results are presented below.
Figure 3.11: The relationship between usage, age and marital status.
Figure 3.11 shows that most single people, aged 20-29, have used health supplements.
Furthermore, the respondents that are married, aged 30-39, is the group that scores second.
15 Zikmund, William G. (2003) "Business Research Methods” 7th Edition. P.476
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This can give pointers regarding which segment that Vigour should direct their market communication towards.
When it comes to price it might also be interesting to find out if there exists any difference when it comes to age and gender. The figure below shows that females in general are willing to spend more for a health supplement containing seaweed.
Figure 3.12: The relationship between age, gender and price.
Furthermore, this figure shows that most respondents aged 20-29 are willing to pay S$20-29 for the product. In addition, the figure also shows that there does not exist any major
differences between males and females when it comes to the price they are willing to pay.
There is only a few respondents that state that they would pay S$40 or more for this kind of product. The results also illustrates the limitation mentioned earlier, regarding the sampling error that occurred due to a high frequency of respondents under the age of 39.
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Figure 3.13: Difference between gender and achievement by using health supplements
Figure 3.13 illustrates that the female respondents are most interested in achieving better heatlh. Furthermore, the biggest difference between the male respondents and female respondents are found in the interest of gaining a slimming effect.
3.5 Summary of findings
By running an analysis on the data collected, we made several findings. The most interesting findings, which can help to answer the research questions, will be presented in this summary.
When it comes to knowledge, 64% of the respondents stated that they had not heard about seaweed based health supplements, and 46% stated that they had never used health
supplements. Furthermore, 47% of the respondents stated that they believed that health supplements had a postive effect on their health.
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Thirdly, one of Vigour’s spesific requests was to find out more about country of origin and if it should be used in the market communications. On both questions regarding Norway and Arctic Norway, most respondents stated that they had no associations; those who had, responded that salmon or cold climate was their main association. This might imply that the country of origin effect for Norway is not that strong in Singapore. This will be discussed further in the strategic part.
When it comes to retail outlets, the survey showed that pharmacies and health food stores were the most preferred retail outlets. This might be useful for Vigour to know when deciding which distribution channels to focus on.
The cross-tabulation tests that were run showed that the respondents, who most frequently used health supplements, were the single respondents aged between 20-29 years.
Furthermore, by running the same test on price, gender and age, it was clear that only slight differences existed in terms of price willing to pay. However, female respondents tended to be willing to spend slightly more money than the males. Moreover, there were few
differences between the genders and what they wanted to achieve. However, the female respondents showed greater interest in the slimming effect compared to the male respondents.
3.6 In-depth Interviews
In order to answer the second part of the problem definition, we needed a deeper insight into the Singaporean healthcare industry. An exploratory design was therefore seen as the most
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appropriate due to the fact that our knowledge of the problem area was limited. We chose to proceed with in-depth interviews with key people in the industry with particular regards to distribution channels. After approaching a number of players in the health supplement industry, it became clear that this was difficult to achieve.
The findings in the questionnaire revealed that 36% would prefer purchasing food
supplements in health-food stores while 44% would prefer purchasing food supplements in pharmacies. On that basis, we wanted to conduct in-depth interviews with companies that
supplements in health-food stores while 44% would prefer purchasing food supplements in pharmacies. On that basis, we wanted to conduct in-depth interviews with companies that