So, you have decided that you want to register a business. Congratulations! But before you rush to register that name and start telling everyone that you are officially a business owner, I want you to stop for a moment and ask yourself a few important questions.

One thing I have learned from working with entrepreneurs is that business registration should not be the beginning of your preparation. It should be the result of your preparation.

Registering a business is relatively straightforward. Building and operating one successfully is where the real work begins.

Before you register your business in Namibia, here are seven things I believe you should have thought through.

1. Know What Business You Are Actually Starting

This sounds obvious, but you would be surprised how many people approach business registration with nothing more than a business name and an exciting idea.

Before you register, you need to understand what your business actually does. What product or service are you offering? Who are you offering it to? Who is your target market? Who is your persona? What does the market currently look like, and where do you see an opportunity?

You also need to understand whether the business is feasible. Is there a real demand for what you want to offer? Is the market already saturated? What will make someone choose you instead of the next business?

It is not every idea that excites you that needs to be registered immediately. Sometimes an idea needs more research, more planning, or even a completely different approach before you spend money registering it.

2. Understand Which Business Structure Fits You

Another important question is: What type of business are you actually registering?

In Namibia, different business structures have different characteristics and requirements. BIPA currently provides for structures including Close Corporations, private companies, public companies and Section 21 non-profit associations.

Your choice should be based on what you want the business to become, not simply on what your friend or neighbor registered.

For example, if you are running a small, owner-managed, profit-making business, you need to consider whether a Close Corporation is appropriate for your circumstances. If your vision involves significant growth, shareholders, investors or a larger corporate structure, a private company may be more suitable.

The important thing is not to choose a structure simply because it is cheaper or because everybody else is doing it. Look at the nature of your business, your growth plans, your ownership structure and your compliance responsibilities.

Your consultant can give you the options and explain the factors you should consider, but the structure should ultimately fit the business you are building.

3. Know How Much Money You Need to Start

Please don’t tell yourself, “I’ll register first and figure out the money later.”

To me, that’s like jumping from a cruise ship into the ocean without a life jacket, without knowing how to swim and then deciding you’ll figure out how to survive after you’ve jumped.

Before registering, think about your starting capital. What equipment do you need? Will you need stock? Employees? Rent? Marketing? Transport? Software? Licences or other approvals? How much will it cost you to actually deliver your first product or service?

More importantly, if you don’t have the money yet, what is your plan for getting it?

You don’t necessarily need to have every cent sitting in your bank account before you start. But you should have a realistic plan for how you will acquire the resources you need.

4. Choose a Business Name That Can Grow With You

Your business name is more important than simply choosing something you like.Ask yourself: What do I want people to think when they hear my business name?

Think about a name like “Mug and Beans” for a moment. You immediately begin to form an association with food, coffee or drinks. The name gives you a mental picture of what the business might offer.

You also need to think about future growth and your online presence. In a world where customers increasingly find businesses through Google and social media, your name needs to work online as well.

Before settling on a name, consider its uniqueness and whether it can actually be registered. BIPA’s registration process includes name reservation before the relevant registration documents are submitted.

5. Have a Plan for How the Business Will Operate

A registered business is not automatically an operating business. Before registration, you should have an idea of how you are going to get your first customer, how you are going to deliver your first service, how you are going to price yourself and how you are going to keep the business running.

You should also think about how many people you need, whether you need employees immediately, what your operating costs will be and how long you realistically expect it to take before the business becomes profitable.

Remember, starting a business, generating revenue and making a profit are three different stages. You can start a business and make no money. You can generate revenue and still make no profit. Profit comes when your income exceeds your costs.

Understanding that difference before you register can save you from unrealistic expectations later.

6. Understand Your Compliance Responsibilities

Please take this from me, registration with BIPA is not the end of your business obligations. Infact, you have just legally started.

Depending on the nature of your business, you may have additional requirements involving tax, Social Security, labour, local authority requirements, sector-specific regulators and other relevant institutions. BIPA itself advises registered entities to consider the requirements of other relevant institutions after registration.

This is why I always encourage entrepreneurs to understand the compliance requirements of their particular business before registering. You don’t want to register a business only to discover afterward that operating it legally requires additional registrations, certificates, licences or other approvals.

7. Be Ready to Separate Your Business From Your Personal Life

One of the first things I encourage my business registration clients is to have a separate business bank account. Your business money should not be the same money you use to pay your children’s school fees, your personal bills or your household expenses.

When your business finances and personal finances are mixed, you lose visibility. You may not know whether your business is actually making a profit because the business is constantly paying for expenses that have nothing to do with its operations.

Give yourself an allowance or salary when the business can afford it, even if that amount is small in the beginning. And start keeping records from day one. Keep your receipts, invoices and records of what you spend even during the research stage. Good records help you understand your expenses, income, performance and areas where your business needs improvement.

BIPA also has ongoing annual-return and beneficial-ownership requirements for registered entities, which is another reason why proper record keeping should not be treated as something you will “sort out later.”

Business registration is an important milestone, but it is not the business itself.

Before you spend money registering your business, make sure you understand what you’re building, who you’re building it for, how it will operate, how it will be funded, which structure fits it and what obligations will come with it.

At LiiSuel Consultancy CC, I don’t believe in simply helping someone obtain registration documents and sending them on their way. I believe entrepreneurs need to understand what comes after registration too.

If you enjoyed this read, than I think you’ll love reading How to Register a Close Corporation (CC) in Namibia.