An Entrepreneurs Checklist Guide to Starting a Business
Samwel Gathia
December 17, 2022
Entrepreneurship
Starting a business is a journey that an entrepreneur has to plan for the business’s success. The process starts from the conceptualization of a business idea in an entrepreneur’s mind to the hands-on implementation of “breathing life into the business”. Often most entrepreneurs just start the paperwork by registering the business as either a Sole Proprietorship, Partnership or Limited Company and leave it at that stage. However, there is more than just registering the business. In this article, we are going to explore more on the checklist guide an entrepreneur needs to consider on starting a business.
Registration of Business
A business must be registered for it to be recognized legally. Different Jurisdictions have Laws in place that guide the process of Registering a Business entity. In Kenya, we have the Companies Act 2015 which regulates and gives a guide on the registration of Limited Companies and the Registration of Business Names Act which guided on the Registration of Business Names (Sole Proprietorship)
A business entity that is for profit making in nature can either be registered as a:
Sole Proprietorship – A business entity that is run by an individual person.
Partnership – A business entity run by more than one Proprietor.
Limited Company – a business run by Directors who are appointed by the Shareholders.
Not for Profit-making entities can either be registered under the NGO Coordination Board for NGOs or the Registrar of Societies for Foundations, Clubs, Alumni, and Associations.
For More insights on what business entity registration route to take you can view our other post here or contact us for consultation.
What next after Registering the Business
If you just registered your business there are several things you need to get ready to start running the business
If you have a Business Idea that you have not yet conceptualized into a formal business or looking towards registering one, we offer the service. Get in Touch
After incorporating a business there are several steps that you will have to take.
Once you set up a business, it’s prudent to separate your money from that of the business. Sole proprietors often make the mistake of not opening a bank account for their business and end up misusing business money.
Accounting Principles and concepts of separate Entities require we should always separately record the transactions of a business and its owners, this can be effectively achieved when a business has its own bank account for the collection of revenue and paying business expenses.
Banks offer different types of accounts for businesses that are tailor-made to meet business needs. For instance, with a current account, a business will get a Cheque book, mobile banking and internet banking. Read more on factors to consider while opening a Business Banking Account here
Get a Physical Business Address
Depending on the nature of the business; i.e. the products and services that you offer, you will need to set up a physical location for your business.
For service providers, one can adopt to have a Virtual Office Address. With the adoption and growth of technology, a service-based business can adopt to offer its services online. The innovation of new business ideas such as the Virtual Office where you can rent a Virtual office and only go to the office Physically whenever you need to meet clients in person.
Companies offering Virtual offices include Regus, iHub . When you agree with them they will give you the right to use their Address, and you can use any of their offices to do your job. E.g. In Nairobi CBD, Westland’s, Kilimani etc.
On the other hand, businesses that offer physical goods must have a physical location where customers can visit to buy.
Factors to consider while looking for an ideal Business Office Location
A business location will be influenced by the nature of the business and its target market for its products and services.
Target Market for your business
You will want to set up a business where you know you have high-potential customers. If you are targeting high-end clients, you set the business where you can tap them.
Budget
Based on your budget for rental fees, you set up a business where you can comfortably pay rentals even before the business breaks even.
Commercial rent is charged per square foot; the more space you take up the more the rentals you will pay.
Getting a Business License and other relevant Licenses
Before you start operating a physical business you will need to get a license. There are two general Categories of Licenses:
1. Single Business Permit License
The Single Business Permit license you obtain from the county governments in the respective county you will be operating your physical business.
For instance, in Nairobi, Business License are issued at City Hall, you can also get it online from the County Government Service Portal The rates for the General Business Trading License vary depending on the business location, size and nature of the business
2. Sectoral Regulatory License
Certain business economic activities are regulated, and you cannot just start conducting business without the approval licenses.
As an entrepreneur, you will need to hire employees and casual to work in your organization. You will have to engage professionals like us with knowledge of the Employment and Labour Laws to get professional advice.
You will have to acquit yourself with what the Laws state in the following areas:
Employment Contracts
Minimum Wage
Leave Days Provided for by the Law
Terms of Engagement and Dismissal of Employees
Payroll Processing
Statutory Deductions
These are mandatory deductions that a business must deduct from employees’ Salaries and remit to the relevant government agencies. They include:
KRA Pay as You Earn Tax (PAYE)
Social Protection Fund – National Social Security Fund (NSSF)
The deductions, PAYE, NHIF, and NSSF are deducted from the employee’s gross salary based on the provided guideline rates by the relevant Laws. Find out more about these deductions here PAYE, NHIF, NSSF
We offer Payroll Services where we help clients with computing the correct deductions, filing the returns and making the payment by their due dates.
We also have Payroll Software that you can download to do your institution’s Payroll.
Business Branding
You have gone through the other stages from registering the business, getting a relevant license and hiring employees. You now have to brand and market your business products and services.
Branding is a critical strategic stage in a business life cycle. Branding is the identity that people see and identify that is XYZ business e.g. Reputable global business brands such as Samsung, and Coca-Cola is easily noticeable by just their visuals such as logo and product design.
Branding for a new business is a critical process that involves creativity and design thinking. What is designed is designed with a symbolic meaning to represent something. For instance, a business Logo is a symbolic visual that should communicate the company’s activities, core values, vision and mission.
Under branding for a new business, the entrepreneur should come up with the following:
Business Logo
Company Corporate colours
Company slogan or Motto
Branding is the identity of the business and will influence other things that the business will need to develop. For instance, you will require to get the following items for your business operations:
As a startup business, you will need to do active marketing to create awareness of your brand to potential clients and customers. There are different marketing approaches that you can take to market your business; Print Marketing, Word of mouth, and most effective digital marketing.
One of the most efficient online marketing tools that you cannot fail to consider is setting up a business website
Get a Business website for your Business
Every day we use the internet and when we access information online we access it from websites. A website is therefore a publically accessible platform over the internet accessible from a browser. You will need a business website for several reasons:
It gives your business a global audience: When you set up a website, anyone can access it across the world by just visiting your website address – domain.
Customers can Contact You Swiftly: The website can be developed to include contact forms that customers fill out for inquiries.
Receive Payments: A website can be developed and integrated with banks and mobile money to receive payment online.
The essentials of a business website:
a.Domain Name
A domain in the website address that users use to locate your website. The domain should be the name of your business for people to easily locate it.
The website domain name includes a suffix at the end, there are different types you can choose as follows;
Suffix
Business Category
.co.ke
Regional – Represent Kenyan Company
.com
Global
.org
Suitable for Not For Profit Organizations
.net
Suitable for Tech companies
b.Website Hosting
A website is a collection of pages with information, images, videos, contact forms etc. All these pieces of information are stored in a place that can be accessible publically over the internet. This storage place is called a Server. Since setting up a server for your website is expensive, you will need to lease a Website Hosting Company to host your website on a virtual server where your website content can be accessed globally
c.Website Content Development
The website should be developed by coming up with the content to be posted on the web pages.A business website it must have at least pages showing; About your business, the Services you Offer, the Location of the Business, The Business Management Team, Contact Page.
The content should be developed by an expert who will refine it with keywords that will make it rank top on search engines (SEO). If a business website rank on the first page results, it will have more traffic meaning more business
Engage experts and Professionals to steer your business in the right direction
As the entrepreneur starting a business, you will be at the heart of the business steering it to the vision you have put up. There are challenges you will encounter along as the business operates, this includes business risks, financial risks and operational risks. To manoeuvre over these challenges, you will have to engage professionals who will advise you on how to manoeuvre them,for Instance:
Lawyers for drawing legal documents such as employment and supplier agreements
Insurance Brokers for the provision of Insurance to mitigate certain business Risks
IT Experts for the provision of solutions such as Networking, System Installations etc
Conclusion
There is more than an entrepreneur must consider while starting a business. From registering the business for it to be recognized legally, to doing the initial paperwork of opening a business bank account, branding the business marketing it and operating it.
What we have highlighted is just the tip of the iceberg of the checklist guide on starting a business, but there is more. It’s a process in which you can get in touch with our team for guidance.
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