Greetings students and friends. Hope you all having a great week so far. Today we are going to talk about what is happening in the news and why we should care
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First we are going to talk about a programme that has now been made available for every entrepreneur and those interested in start up projects. The programme is called the iZone preincubation programme which is a set of workshops for every entrepreneur and young person. It is a brilliant opportunity for learning about small businesses and other ventures with the Zim economy in mind. The programme which will run from May to November 2015 offers young people from the ages of 18-35years a chance to grow their businesses with the required support and dedication that is required. As part of the programme the "incubators" will be exposed to business, innovative and technological environments and the programme is likely to take place in Harare. I think it it clear why you should care. To register and for more info go to http://www.kubatana.net/2015/04/13/5989/entrepreneurship-incubation-innovation-small-business-start-up-funding-youth-finance/
Secondly we going to talk about an article in the Newsday (10 April 2015) entitled Thinking beyond small: How to grow your SME business. The comments below the post show that the content of the article have been reused and recycled but some of the lessons in the article are valid even now. So take a look at some of the points raised below
Creating a name for your business
One of the chief advantages of registering a company is the fact that
you can create a name that matches the service or product the company
is in the business of delivering.
Remember a company is a separate person and can and should gain its
own personality and identity. This is the beginning of creating a unique
brand for your company. A registered company also offers a level of
legal liability protection to the owners through the concept of limited
liability. A company is regarded as a separate legal entity to its
owners or managers.
Developing a unique brand identity
Having carefully chosen a name for you company, identify and create
an associated logo or brand mark. This goes hand in hand with the name
of the company. This will ensure that your company cannot and should
not be confused for another.
If your product or service is good, your business will more easily stand out amongst many in this way.
Building Goodwill: An unregistered entity will struggle to generate goodwill with clients and suppliers.
For example, if you want to supply raw materials to larger companies or services or goods to government departments, you need to have a properly registered and compliant company.
Building Goodwill: An unregistered entity will struggle to generate goodwill with clients and suppliers.
For example, if you want to supply raw materials to larger companies or services or goods to government departments, you need to have a properly registered and compliant company.
Registered companies would rather deal with another registered
company and not an individual. Registering your company and giving it a
good name and unique identity will earn your business the respect of
other businesses.
Ironically, individuals who may be suppliers or customers of your business also prefer to deal with a registered company and would extend favourable terms of trade.
Ironically, individuals who may be suppliers or customers of your business also prefer to deal with a registered company and would extend favourable terms of trade.
Developing a sound banking relationship: Banks generally require a
business to be formally registered as a company with the registrar of
companies before it can operate a business banking account.
Further to this, your company will need an initial tax clearance certificate from Zimra.
Unless your business already has a trading record, this certificate is normally issued to certify that your business is a new business and has no previous accumulated tax liabilities.
Unless your business already has a trading record, this certificate is normally issued to certify that your business is a new business and has no previous accumulated tax liabilities.
To get this certificate from Zimra also requires company registration documents.
Whilst sole trader businesses are also allowed to open accounts, this sort of account is usually in the name of the owner and may not give the benefits accorded to company accounts, such as relative ease of access to loan facilities.
Whilst sole trader businesses are also allowed to open accounts, this sort of account is usually in the name of the owner and may not give the benefits accorded to company accounts, such as relative ease of access to loan facilities.
Accessing Bank Loans: As a follow on to the above, banks and other
financial institutions are less eager to deal with unregistered
entities.
The more formal your business, in terms of record keeping and
registration etc, the more likely your business will be attractive to a
banker. You may have a very viable business idea, and it may be very
profitable, but if your business is not very organized, you will find it
difficult to convince your bank for support.
Attracting New Investors: Having a properly registered business makes
it easier to introduce new investors into the business as shareholders
or creditors as the business grows. Once your business has been
registered with the Registrar of Companies, The company’s Articles of
Association will normally spell out how such shareholder changes can be
effected.
It is also easy to draw up separate shareholders agreements in relation to a stand-alone company.
Managing growth, longevity and continuity
A company being a separate legal entity can outlive its founders. One
of the advantages of registering your business under a company is the
continuity it can bring to your business. You do not always need to be
around as the founder. A company can also hire managers and other
personnel in its own right to drive the company forward. It is difficult
to attract quality skills if your business is not duly registered and
it may create legal issues in future. Having a duly registered company
helps to more easily manage opportunities for growth and expansion that
may arise in future such as attracting new investors.
Trade and Local Authority Licences: Local and regulatory licensing
boards may require your business to be legally registered before you can
be issued certain types of trading licenses.
For instance, for your business to be on the register of suppliers to
the government, the State Procurement Board deals only with properly
registered and licensed companies as a legal requirement.
This list of benefits is by no means exhaustive or complete. In the next articles, we will discuss some of the myriad challenges and barriers that MSMEs are facing in formalizing their businesses. For more visit the newsday website https://www.newsday.co.zw/2015/04/10/thinking-beyond-small-how-to-grow-your-sme-business/
This list of benefits is by no means exhaustive or complete. In the next articles, we will discuss some of the myriad challenges and barriers that MSMEs are facing in formalizing their businesses. For more visit the newsday website https://www.newsday.co.zw/2015/04/10/thinking-beyond-small-how-to-grow-your-sme-business/
That is all for what is in the news about small businesses. Happy moneymaking
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