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You have done your market research, you have your business plan ready, you have mobilized your resources, you literally have everything ready, and you are wondering what next now for my business?
Now you have to ask yourself whether you are going to operate legally or illegally. Still, for the sake of operating at peace, the next thing that you should think about is getting your business registered as a legal entity.
Legalization gives you courage as a business owner to operate freely without fear of any security risks. Many other benefits come along with officiating the presence of a business in a region, for example, having access to banks, access to legal services, free trade with other businesses locally and internationally and in the public sector.
It also helps you stay alert to the required taxes and laws so that you are completely free from penalties from local authorities and any other governance bodies.
In most cases and several countries, especially in Africa, registering a business or company is quite long and takes a bit of time. For this reason, most of the companies in most countries operate illegally, or at times you might find that business owners don’t have where to start from and don’t even know what to do or what is required of them to register their businesses and get them running.
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Now, as opposed to what already exists in the mindset of the majority that registering a business is a long process, in Zimbabwe, it is an easy and smooth process; you just have to find the right body in charge. Let us take a deeper look at the process that you have to follow while registering a business in Zimbabwe;
Register your business in Zimbabwe
1. Identify your business /company name
This is one of the primary steps in the process of registering a business. Choosing a good name is essential, bearing in mind that a good name sells and speaks to your brand; therefore, as an entrepreneur, you have to choose an exceptional name that aligns with what your business/ company does.
To register your business in Zimbabwe, you are required to submit a list of 1-5 names of your choice in the order you would like them to appear. The names provided are subjected to approval by the registrar of companies to check if there are already existing businesses with the same names. If there are no existing businesses with similar names, your businesses names will be approved. However, if other businesses have similar names, you will be asked to choose other names; this is a requirement by both PBC and PCL in Zimbabwe.
2. Identify your business type
Now that you have already reserved your business name, the next thing is knowing and identifying the business type you want to operate. There are majorly two types of business operations in Zimbabwe, i.e., Private Limited Company (PLC) and Private Business Corporation (PBC). These are the most common ones in Zimbabwe. They are under the Companies Act in the laws that govern business and company registration; hence registration requirements are usually put into two major categories.
To identify your venture and the category in which it belongs, specify key things like the mission, the vision, main objectives, products and services; this helps to understand your venture and the category in which it belongs. If you choose to operate under a private limited company, the registration fee is about $300. Registering PBC goes for $70 ( basic registration), while $140 is for optional member certificates.
3. Identifying Business location details, the physical and postal address
This is key for business registration and confirmation; here, the information required is mainly the business’s physical addresses, i.e., county, plot number, ward, city and street, and contact information. This is a requirement for registration of both PBC and PLC
4. Business management and leadership
This requires you to provide details regarding the team leading the business. These include the directors' information; usually, three people are required. The details required include; full names, National Identification Number or passport number, certified copies of identity documents and the residential address details of each one of the directors.
The PCL requires you to have details of directors, and these must be between 2-50 people, and these details have to go CR14. A business can register company shareholders as directors of the business, but this is for PLC. Both PCB and PLC entities must have one Zimbabwean as part of the company directors or shareholders.
5. Company shareholders
These are people who have invested money/ capital in the business. PLC and PBC registration require you to state shareholders and the percentage interest they hold in the business, totaling up to 100%. In addition, the private Business Corporation requests for full names and ID numbers of people who are between 1-20 members; these must be either shareholders, owners or directors of the business.
Registration with PCL requests for full names, ID or passport numbers and addresses of shareholders or owners or investors; these have to go on the memorandum. Important to note is that with PLC registration, a company can have shareholders the same as directors; however, they are different in some cases. Other outstanding requirements for a PLC registration are the shared capital of the company and the number of shares each shareholder is having. Then each one of the shareholders is required to sign on memorandum and articles of association, and then 1 director or business secretary must sign the CR6 and CR14.
5. Handing in the application
When you have got all the information you want, and all the required details have been filled in, the next step is applying to the registrar of companies to facilitate the registration process. The PBC registration requires each business member to sign an incorporation statement before the registrar of companies signs it off.
6. Opening a corporate account
Another critical step in registering a business is opening a bank account where business transactions will occur. While opening up a bank account, legal company documents are a requirement, depository fee and bank advice note and then a tax clearance certificate which the Zimbabwe Revenue Authority gives. Additionally, the date for closing financial accounts or the financial year is very urgent and has to be indicated.
In conclusion, registering your business before you start operating is no longer an option as it used. Still, it is now a necessity. Sometimes, business registration seems tiresome and hectic, and you feel like giving up now that you don’t have to worry about this anymore.