If you want to play in the top league of business, you have to formalise it
Most of you who follow me on Facebook will recall the story of the young men who make paint. The ones we bought from paint some time back in the spirit of supporting start ups..
We made our first deliveries but had issues with their formality. On our part I think we were a notch too kind and didn't look at certain things in regards to their formal and legal status.
I could say the person we assigned the duty of doing due diligence didn't do their part but nevertheless we found a way around it.
However I told them we would not continue buying from them if they didn't sort their legal and formal status i.e register, sign up for taxes and UNBS for standards. It's one thing having a good product which they honestly did have but there are legal and formal requirements for doing business in this country just like any other country in the world.
Now it's hard for the state to enforce adherence to some of these requirements from top to bottom hence making it easy for you to operate without them at the bottom.
Enforcement is usually done at the top where there's big contracts, big money and big business. There's heavy vigilance at the top, meaning if you want to play in the top league there's no way you will circumvent these requirements.
Now I have been urging these young men to get their act together something they don't seem to take as a priority or urgent/important. I even offered to guide and advise but I got to point where it seemed I wanted it more than they did so I decided to cool it a little.
I have seen many small businesses doing great things but they only do so informally. The fear is usually, if you go formal then the state will come for you.
Due to this misguided fear they end up not formalising, something that keeps them at the bottom, playing in the bottom league.
Now let's me use football to drive my point home.
Those who watch the premier league know there's too much money in the league and players get paid lots of money to play there.
The lower you go, the lower the potential of getting paid top dollar. You can't earn the same playing in the championship, neither can you earn the same playing in the first division like those in the championship do. The lower you go, the lower the pay.
Playing in the premier league comes with more attention from all corners. It's the same as doing business in the top league. Any business that has dreams and hopes of growing big can't be playing in bottom leagues and should be working day and night to qualify to play in the big league just like every footballer does.
In the top/big league it's big money, big transactions, big growth, big business and you have to qualify to play there.
Your papers have to be in order to start with then your quality follows.
Jaluum Herberts Luwizza is a Speaker,Writer and Business Columnist with the Nile Post.He is also a Business Consultant at YOUNG TREP East Africa's No.1 Business Management and Consultancy firm that helps people start and grow profitable businesses.
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