Registering A Company in Zimbabwe: Key Things You Need to Know

Every New Business Owner Needs To Know This: So you have written a business plan, validated the business case, and you are beaming with excitement to get your venture rolling. 

The next crucial step is to take a minute to pause and ask yourself: “Do I have all areas covered? Do I all the necessary documentation needed to become a legal entity in the country?”

New business owners often find themselves unaware or, moreover, not having the necessary documents needed to become a legal entity and because of the dread of bureaucratic processes in making their operations legal, they resort to operating unregistered.

To help, we have researched and come up with a business starter pack that each new owner needs to know to get the required documents for their company.

Step 1: Register your company: Contrary to the view that this is a long and tedious process, choosing the right registrar can make your life easier. What are the key considerations you need to make at this point?

Start with the name: This is the first step in the registration process. Many times, choosing the right name is equally important as running the business itself. Your name has to be unique, easy to remember, precise, and a reflective of your business. A name is important for it is that which business will build its brand. The requirement at registration is that registrants submit a list of at least four names in order of preference, for checks against a list of already registered companies. 

Names are approved when not similar to an existing company.

You have managed to figure out a list of names that are unique and would like to adopt, the next step is to understand what sort of business you are. This is often influenced by whether you need to create a Private Limited or PBC.

What is your business speciality? A business needs to specify which area it ventures in by giving a brief summary of products and services including corporate objectives. Some business owners may not know what exactly they would like to start with; the provision being that you can register your business as a general trading business. That way you can broaden your scope when you need to do so. When you have completed this section you are required to provide information about your location

Where will your business be located? Information to be supplied is that of the business’ physical address and contact information. New business owners often worry that they do not have physical premises because, well, sometimes the owner is the business. In such cases, it is permissible to use your residential address if the title deeds are in your name. If not, a signed affidavit from the owner suffices.

Who owns and manages the business? Director’s information is mandatory and should be provided as you are registering the business. This includes full name, national identification number, and residential address of each director.

Shareholders: These are the owners of the business who have invested capital into it to make it a viable entity. As such, there is need to state who owns what percentage stake of the business. All share percentages total to 100 percent.

Submitting the application: Just as is, this is all the information needed to submit to the registrar who will facilitate the registration process for you. As Tradejerk Services this is where we plug in to do all the heavy lifting for you. We handle all processes at the Companies Registry for you and in five days or less, your company will be registered.

Now that the first step towards legalizing your business is done, next is to think about how you will be transacting. At this point, you will need an account with a reputable bank.

Corporate Account: To apply for a bank account one needs the official company registration documents, supporting documentation (proof of residence for al director), the deposit fee (varies according to bank), and a bank advice note which instructs the bank to open an account for your now registered company.

After the bank account is opened, you are just one step away from running legally, pending other certifications and permutations which can be requirements in specific industries. The final step needed in getting the legal documentation of your new venture is a Tax Clearance Certificate which is issued out by the Zimbabwe Revenue Authority (ZIMRA).

Tax Clearance: This is a written confirmation that a company’s tax affairs are in order and up to date.

Importance of tax clearance:
It is a compliance issue and businesses need to adhere to it.
A tax clearance is necessary when bidding for tenders.
Needed when applying for licences issued by the local authorities.
It inspires confidence in business counterparts and encourages them to do business with you.

When all these documents have been put in place, your business is now considered a legal entity. This process is often misconstrued to belong and bureaucratic, but that is usually because of lack of information. Having the right registrar can smooth the process and make it hustle free.

At Tradejerk Services we have wide experience and knowledge across many industries and understand that registering a business is not simply about the paperwork. Our approach is different because we move with you each step of the way. 

We help you unpack your enterprise vision, so you know which type of business is best suited for your market, how to come up with a unique name which your brand is anchored on, and any business-related advice you might need as you start your venture.

That is not all …we are still here to hold your hand because as a new business, we want you to focus on your core business of meeting your bottom-line. Leave the worrying about conducting tax health checks, filing tax returns, VAT registrations and any other accounting services to us because we understand it better.

Starting and making your business legal and compliant to company regulations is no longer as tedious as before. Choosing the right partner to help you can ensure all processes are complete and you are up and running in less than five days. So, what are you waiting for?

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Brand Builders   September 22, 2019

Zimbabwe’s Economic Crisis A Concealed Opportunity!

After some time, every business is vulnerable to a crisis, but an organisation that weathers a crisis well appreciates that harsh conditions are a concealed opportunity for growth and change. 

To look at the definition of crisis, Collins English Dictionary describes it as a time of great danger or trouble, often one which threatens to result in unpleasant consequences. In business, the danger or trouble threatens to seriously interrupt processes and negatively affect the bottom line, even resulting in company closure.

Since a crisis results in some form of loss or change and its nature is antithetical to core values of predictability and certainty, people and businesses will be so desperate to get back to the comfort zone of the known, but crisis prohibits such an option. The VUCA world is here – over the past couple of years, the world has changed but expectations are lagging! Fortunately, when there is no going back, there lies the opportunity for growth and change. 

According to Les Brown, “If you put yourself in a position where you have to stretch outside your comfort zone, then you are forced to expand your consciousness and to strive and achieve.” As a business, if you are struggling and you are still holding on to the old, it is time to change your processes and the approach, for the old might not be coming back – the new is reality!

Economically, experts are viewing the Zimbabwean situation as deteriorating, where prices are spiking, the business executives are concerned about the foreign currency shortages which are resulting in delayed payments for raw material imports, the tax regime is not as favorable and several other challenges. To the eye that seeks the comfort zone, it’s all gloomy and dark, but to the other – what a moment of endless opportunities. Several successful nations in the world have gone through the crisis that Zimbabwe is facing, and there is a lot to learn from them.

Previously, Zimbabwe was well ranked economically, but the real benefit of such development was marginalized. Wealth was in the hands of a few, and the majority knew nothing about business and how to make money, rather than being employed. The issues of economics were understood by a few. Not to justify the current economic crisis, but it has given Zimbabweans a new look to business and economics – they now have a better understanding of how things should be run – an asset that will propel them soon. Currently, it is ‘survival’ business, but soon it will emerge into real business, were people respect laws and bribes will be a thing of the past.

So, where are the opportunities for growth and change in this crisis? Diversification is one opportunity that businesses can pursue. Some scholars have criticized diversification, but its benefits cannot be ignored. With the way things have changed, it might no longer be sustainable for a business to have one stream of revenue or income. Diversification into other fields to generate extra revenue is no longer an option, but a necessity. Almost 90% of surviving businesses in Zimbabwe wants to import raw materials and are failing due to shortages of foreign currency. What would it take to diversify into that field of producing the raw materials? The money spent on importing the raw materials will be ‘enough’ for the equipment to produce.

Mergers and acquisitions are also an area of opportunity currently for business. There are so many small businesses that are producing the same products and services, but at a higher cost, making their products more expensive than the imports. It would be noble for some of these businesses to merge and take advantage of the economies of scale and produce competitively against imports – thereby creating a market. Though it is encouraged to have many players, sometimes too many players cause ‘noise’ (including bribes to get customers – fueling the corruption cycles in companies where one must bribe the buyer to push even substandard products into the organisation – pushing up the price of raw materials to incorporate the buyer’s bribe – eventually making the final product uncompetitive against imports).

When small businesses merge, it is an opportunity to tap into territories that one small business would not have tapped into, creating even excess products and services for the export market. A small business has no voice and muscle, but in the case of a merger, a bigger business will emerge with a strengthened muscle and can voice!

Crisis calls for the most efficient way of producing to remain in the game. This therefore forces the business executives to revisit their processes and make them lean but producing the same products even faster and at a lower cost. With the current shortages of foreign currency to import products or services or raw materials, it is an opportunity for the real entrepreneur to find ways of making the products locally. Complaining and wining about the crisis is not the answer! Everywhere you turn your head in this beautiful country, you see a problem – which is an opportunity to provide the solution and launch a great business. There are so many little things that can be done to create opportunities and take advantage of them.

A story is told, “Lyft is an on-demand transportation company primarily providing ride-hailing services and based in San Francisco, California. It develops, markets, and operates the Lyft car transportation mobile app. Launched in June 2012, Lyft operates in approximately 300 U.S. cities, including New York, San Francisco, and Los Angeles and provides over 1 million rides per day. The company was valued at US$15.1 billion as of June 2018 and has raised a total of US$5.1 billion in funding. Lyft expanded into Canada (specifically serving Greater Toronto, Hamilton and Ottawa) in December 2017 as a competitor to the already established Uber. As of late 2018, Lyft was the number two ride-hailing company with a 28 percent market share in the United States, according to the Second Measure research company.”

“Lyft was launched in the summer of 2012 by Logan Green and John Zimmer as a service of Zimride, a long-distance ridesharing company the two founded in 2007…The company name comes from the country Zimbabwe, where, during a trip in 2005, Green observed locals sharing minivan taxis (mushika-shika). He said, “I came back to the US-inspired to create that same form of transportation here.”” What one eye saw as a crisis of not having a functioning transport system, another eye saw as an opportunity for a billion-dollar business! Countless ideas originated from Zimbabwe, and multi-million-dollar companies are created, whilst its citizens are debating silly issues.

Now, what do you see in Zimbabwe? Do you see crisis, or you see opportunities? It will be so sad for someone to come from another country and setup a business in Zimbabwe, solve the current problems and give you a job. Why can’t we make our own jobs? Let us personalize our own problems and find our own solutions that have no conditions attached to them! Then and only then will Zimbabwe boast of true economic development. It will be a shame for the nation to be developed and Zimbabweans remain poor! Why can’t it be a nation’s agenda to make many real millionaires in the next 10 years? Without the right purpose and vision, the nation will remain in crisis.

Nevertheless, for better economic development, good policies are needed as a matter of urgency to support the knowledge and understanding that Zimbabweans have acquired in the past 20+ years of hardships, to enable them to develop their own economy. Without good policies, all other efforts will be in vain. True economic development starts with good policies, both economically and politically. All other issues that are debated are simply symptoms of poor policies. When you want to fix a problem once and for all, ignore the symptoms and go to the root cause – which is policy, everything else will follow suit.

Contrary to many beliefs, Zimbabwe’s biggest problem is policies and laws rather than ‘politics’! Greatly, there is nothing new under the sun, some of the good policies and decisions can be copied from developed nations and implemented in Zimbabwe. With the right consistent policies, the ship ‘Zimbabwe’ will be stirred in the right direction. Most importantly, the job of economic development is never a one man’s job, but every citizen must play a part!

Antanio Gramsci once said, “The crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum, a great variety of morbid symptoms appear.” Therefore, Zimbabwe’s crisis is a concealed opportunity for a real business, as the old systems and processes of doing business are dying – and a way is being paved for the new systems and processes that drive the business forward!

Batanai Kamunyaru is a business writer, speaker and coach. He can be contacted on bat.kamunyaru@gmail.com or +263 718 852 489.

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Brand Builders   September 22, 2019