I see a lot of business owners running their small businesses without even thinking of registering it properly with the right authorities. The ones that do register their business only do it as a formality without even knowing why they are supposed to.
WARNING; That is RISKY business!
Your business is a different entity from you as a person. Even if you might take up multiple roles like Manager, Accountant, Operations Manager and others, you must realize that your business is NOT you.
Here are some reasons why you should definitely register your business especially when you are sure of how much you make and have some steady flow of customers after a short while of running it.
1. To get the business name of your choice!
Some people wait for their business to pick up first before they think of registering it and while this might work for some people, it doesn’t work for most.
Just picture this scenario – you start a small business but you don’t register it because you feel it is too small. Then business picks up and you want to register it only to find out that your business name is already in use!
Clashing business names is one of the many problems that can arise when you do not register your business name on time. It means that your business can stand the risk of being sued because in the eyes of the law, you are operating your business under the trademark of another business that is registered – without permission.auntyronke
This can cost you a lot of money in court. It also means that you may have to change the brand name that your customer base are already familiar with and this can cost you a lot of value even beyond just money but in re-branding as well as your customers struggling to get familiar with your new brand identity.
Whew! Save yourself this stress and register your business!
2. You will lose multi-million Naira deals if you operate without a license
One scenario I can remember is a young lady, (one of our clients) who lost multiple huge purchases simply because she didn’t have a registered business.
Do you know for example, most large firms cannot do business with you as an individual? Because they are not allowed to pay cash to individuals but can only make purchases with purchase orders and quotes from business entities – which is what your business becomes once you’re registered.
So take for example that you have been looking for a breakthrough in your beautiful ankara business and one big bank approaches you for a contract to provide all their staff of close to 2,000 people ankara and aso-oke for their end of the year celebration. That is a big deal and you can certainly deliver but do you know that if you are not legally registered as a business you have lost that deal? This is a true story.
The reason for this is because for an organization like that they are not allowed to do business with individuals to avoid “stories that touch” so it is ideal to be a business to business (B2B) transaction. You will have just lost a potential ten million naira deal because of your inability to see far!
So if you think that you’ll just be going about giving your personal account number to your clients then you had better think again. Unless of course, you don’t see your business growing beyond the one customer retail type of business.
3. You can get cheated out of your hard earned money, if you run an unregistered business
I’ve seen cases where people use the “corner-corner” way to get transactions like this without registering their business by telling someone who perhaps has a registered business to do it on their behalf.
How do I mean? You don’t have a registered business and you got a huge deal from a big company. It’s too late for you to run around running your business so you go through someone who already has a registered business as “middleman” so that you can get the contract, abi?
The only problem is that “money fit change pesin O!” so after the deal and you have delivered, the person may take advantage of you and come up with excuses like “Shebi na me do all the work?” and others. Just because you let him in as a middleman in the deal and his own registered business was used!
It can be painful but if you’ve been prepared for business and had registered your business from the start, someone else would not have “stolen your glory” #justlikethat!
4. With a registered business, you can EASILY get loans/grants from government
Asides from these scenarios, having a registered business is like “sure express” to get grants from the government during difficult times like this COVID era.
Do you know that because of the pandemic, the government has been giving small business owners financial support during this period to help them grow?
All you have to do is show proof that you are a business owner (which is the registration documents) and proof of tax payment as well.
I know two people that have gotten grants of N250,000 each this past few months from the federal government. Now, if you don’t have a registered business then how do you qualify for such “free gifts” or “good of the land” if you will call them that?
There are many more risks associated with running your business without registering it! Don’t be that business person that takes unnecessary risks.
Don’t let opportunities pass you by because you don’t want to do the right thing, register your business today!
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See you next time!