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Financial capacity is not the only requirement that an aspiring entrepreneur requires to start a business. There are a lot of factors such as market research, time availability, skills, economic status, backup financial plan and legal considerations among others that need to be observed. However despite these considerations, many entrepreneurs have very little knowledge on the legal requirements that are expected of them by their respective laws and authorities.
Everything from the logo to the operations of the business have legal implications of the business and its owners. Below are some of the global legal requirements for any business to operate:
- You need to verify that the name you intend to use for your business are not in use by any other business. This is done by registering your business. For instance in Kenya, the Registrar of Companies is the government body tasked to do this.
- Have a business structure in place i.e. is it a sole proprietorship, Partnership etc. as this has varying legal requirements that are expected of the owners.
- Business licenses. This depends on the kind of business you run. Know about the permits you are required to have in order to be legally operating.
- Non-Disclosure Agreements If you will be setting up finance for your business or entering into contracts with suppliers, you should consider confidentiality and non-disclosure agreements. This is because these outside firms will have access to business information that you may want to keep private, you should consider having them sign these agreements.
· Zoning. The location for your business has to be properly zoned for the type of business you plan to operate. For example factories that emit harmful gases cannot be set up in places that have high human population.
· Have a good business plan that will be the blue print of how your business plans to raise capital, utilize its factors of production and achieve its long term and short term goals.
The above requirements will guide the entrepreneur in settings a business establishment that is legally recognized and thus operating within the law. This will come with the following benefits:
· If you comply with all the legal requirements then you will not have legal battles in court which will save your business time and money
· Legal compliance saves your organization from the negative publicity that comes with legal battles due to non-compliance.
· Complying gives your business a good image as it enhances the customer confidence and loyalty.
· A compliant business owner is able to know his or her rights as the authorities normally inform the registered business owners of their rights through seminar and conferences.
It is important to note that most successful businesses are compliant with their respective laws of governance. Therefore legal compliance is one of the ingredients to a thriving business establishment.