by Kathryn Main
What do you think I mean if I have to ask you the question; “Is your business compliant”? Most new business owners don’t understand what compliance is required in their type of business. Compliance will be different for different industries and income brackets.
There are a few non-negotiable compliance requirements if you want to work with corporates or government departments. EG: A registered business with CIPC, a tax clearance certificate, registration with regulatory body.
There is also business best practice and some compliance processes that should be mandatory in your small business.
Depending on the type of business you want to build will depend on the type of compliance you need. The best advice I can give you is to start from day 1. If you plan to work with big organisations or have an exit strategy to sell at some point then you will need to register with CIPC, SARS, industry bodies and you might even want to consider registering a trade mark or patent for your products. If you plan to grow and scale into other territories trade marks and patents can help you to ensure competitors don’t use your name or trade off your good reputation.
As a business owner myself I always do my due diligence on future suppliers and contractors. I always check that they are who they say they are. So, in my on boarding process, other than making them sign an NDA, I check with CIPC that they are in fact a registered business and that their CIPC annual returns are up to date. Then I check with SARS if they are compliant. I also verify their bank account. These are standard processes that big companies use when small companies work for them, why not check out who you are working with as a small business?
I have seen some terrible types of fraud with some of the mentees that I work with and it’s a lack of process and due diligence around compliance. I have seen companies close because they have not correctly vetted their customers. I was mentoring a security company in the North West. They won a big security contract. The contract was a game changer for this small business and they were promised a R200 000 retainer. For them to fulfill this contract they needed a bakkie, 5 new staff and 5 staff uniforms and equipment, as well as a quad bike to patrol the property. The security company went out a bought a bakkie, quad bike and staff uniforms, employed 5 more staff and started their contract. 3 months later this company had not paid them. When they came to me for assistance and we did some due diligence we found out that the mine they were guarding had been hijacked by criminals and he was securing a mine that did not belong to the contract owner. The owners of the business had many Google complaints and the company was de registered by CIPC 2 years previously. If this client had just taken the time to check the CIPC status and do a brief check on the owners, they would not have lost so much money and now had no way of getting that money back and they had not paid staff for 3 months.
Don’t ever be so desperate for work that you take on clients without checking their compliance. Compliance is there to protect us and our customers.
I have created a compliance check list for you to check the status of your own business compliance. Please see the compliance check list here:
If you are looking for words to describe Kathryn Main, CEO the Money Savvy brands, quirky, determined, visionary and masterful are just some that spring to mind. Kathryn is an author and award winning businesswoman and has won awards for her advertising agency as well as Money Savvy Kids. Kathryn has a passion to change the face of education on the African continent through financial literacy education and training. The Money Savvy brands are revolutionizing the way financial knowledge is disseminated to younger generations of South Africans. Money Savvy Kids + Teens promotes in youth the skills, knowledge attitudes and behaviors required to be financially independent.
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