Operating a non-legalised business is like walking a journey whose destination is not known, experts tell entrepreneurs.
Mr Benard Mukasa, a legal and business expert, while training young entrepreneurs and innovators in Kampala said many enterprises are not legalised something that exposes them to collapse in case of financial predicaments.
He said financial institutions and investors would not risk cooperating with a business whose operations are not legalised or not known in books of regulators and revenue collectors.
“By legalization, we mean the innovation or enterprise should be registered. It should have tax and accounts records for one to know the business is being run by a competent person. You should know by-laws that govern the business,” Mr Mukasa said.
A one day legal training for young entrepreneurs and innovators was organised by Reach A Hand Uganda (RAHU) and Young Achievers Uganda. Mr Mukasa said a legalised business builds confidence in public, clients, customers and possible partners. He challenged innovators to register their innovations and enterprises at infancy stages as opposed to waiting for the business to accumulate profits.
“Register your business; clearly spell out co-owners or board members. Have records to show how the business fares financially. This would help when you need an investor, a loan or partner to boost the business,” Mr Mukasa added.
Ms Christine Kyeyune, vice president of Institute of corporate governance of Uganda, informed participants that registration of business secures it from piracy.
“If your innovation is not registered you expose it to piracy. People will duplicate your goods and could register using your name. You will have no proof that you own it,” Ms Kyeyune said.
Ms Sandra Kembabazi, Young Achievers project liaison officer, said the training opened her mind because she had feared to register her business thinking she would expose it to revenue collectors.
“I always thought that keeping my business status a secret saves it from revenue collectors but I now I know I was just risking it. I have known why people never wanted to cooperate with me,” Ms Kembabazi said.
Ms Kembabazi further highlighted factors like insufficient capital hinder beginning entrepreneurs to have businesses registered. She said requirements for business registration needs books of accounts and number of employees which is challenging for beginners.
CREDIT: MONITOR PUBLICATIONS