Matsobanemetja Business Consulting Pty Ltd

Even in business one need to follow or adjust to certain rules or manner of doing things, because this guidelines may assist in opening opportunities for us. Those that we do business with will be patient with us, be willing to listen to what we are to propose or say because we would have presented ourselves accordingly. Therefore we need to be careful not to compromise such etiquette in business.

1.Communication

Communication plays an important role in our lives, in business too. How you approach and communicate with your business associates is crucial, to a fact that people may lose interest of doing business with you due to your lack of proper communication. We must still continue with our formal traditional way of communicating regardless of the type of medium we are using. When you write your  email it must consist of the Headings (Greetings), Body (Content) and Closing. Do not assume that because you are using the informal type of medium the format does not apply. For example you would like to send me a formal proposal via email but only to find out you do not have my email address, you then decide to send an inbox message on facebook, you will still simply write “Good day Dikeledi, Can i please have your email address, thanks” . There is no way this message will not grab my attention and i will therefore forward to you my email adress without thinking twice and i will still be looking forward to your email. But could you just have inboxed me “send me your email address” without greetings, though i personally will give to you but it would have raised some concern, even more especially if we have never spoken before. Often the use of simple words such as “Please” and  ‘Thank you” when necessary is important.

2.   Be presentable

Reputation is everything in Business. You must learn to be presentable at all times. It is true when it is said you are the face of your company as the owner. Before you even introduce yourself or sell your business you would have been assessed or analysed by how you carry yourself .

Being presentable should not be interpreted otherwise, it simply means being clean and well dressed.  

3. Be on Time

When you have a meeting set at a certain date and time make sure you make it on time, this shows you are serious, professional and not taking the other party for granted. It is also considered to be rude to be late but it would seem more disrespectful if you have not communicated your delays. When you see that you are late please do warn the other party/s, that will show a sign that at least you are considerate.

4. Know when to sell

It is an obvious case that we want people to know about us and our businesses but the truth is we need to have good timing for this. Engage with people first, start with a favourable topic and when all parties are warming up into the conversation it is then that you may find a way to issue your business card or marketing material. You also don’t want people to be worried when meeting you as they know that the networking will only be about you, you and you.

I hope you will find this helpful, i had to learn such in my two and half years in business.

Compiled by Dikeledi Seoloane on behalf of Matsobanemetja Business Consulting (Pty) Ltd – Coaching Division

info@matsobanemetja.co.za

www.matsobanemetja.co.za

The one thing that makes life so interesting and joyful is failure. Honestly this life thing was not going to be fun if in all that we do goes smoothly all the time. As challenging as it is, humankind must learn how to deal with failure. Failure is not as bad as we perceive it to be, i personally think that the more we fear failure or hate it ,it is the more we allow it to defeat us. One way or the other we need failure at some point for us to succeed. We were not going to know the joy of succeeding if we never have experienced failure in our lives.

There are many failures in Business. I remember when i was preparing my last Business event for the year under our Women Empowerment Project, i have encountered so many failures, there was even a point where i was thinking of cancelling the whole event. Today if you ask me about the outcome of the event i will tell you how beautiful the event was. I carry so much pride, but mostly not because the event was beautiful but because i was not defeated by the failures i had encountered. It is always fulfilling to finish what you have started. Most of the time we don’t really realise that our past successes, big or small aid as a motivation for our future.

The following techniques helps me in dealing with failure and overcoming it.

1. Acknowledge Failure

In most cases, and in life in general when we shy away from our circumstances or background we are more unlikely to change the status quo. When failure hits you, acknowledge it and find the way forward. And by so saying we should acknowledge failure i am not saying we should accept things as they are and leave them but i am merely saying that let’s recognise it and let’s find other possible ways to deal with them.

2. Don’t dwell so much on Failure

For sure failure does force one to pause or stop but do not pause forever. Use the time to pause to think of the next move. Once you stop for long, i truly believe it is the more you are allowing the attack. When failure attack you, you need to fight back, think of the new plan or strategy, change positions if you have to but just don’t give up.

3. Think of when you succeeded

I often make use of my past successes as my source of encouragement and motivation. Always refer back to what you have done before and succeeded in it and just gain the confidence that you started whatever what it was and you came out the winner, it really helps. Your past successes helps with your mental and emotional strength.

4. You are not the only one

When you are faced with a challenge you are more likely to feel that you are the only one facing it but you are actually not. You are not the first and you will never be the last. Those who came before you they face the same challenge and they have passed through it because they had chosen not to quit, and therefore you need not to lie to yourself and think you are the first. You just don’t quit, do not  give failure the satisfaction that you are the looser.

And i also find what works for me more is that i have more positive thoughts than negatives. I will always try to find the positive in everything and that gives me the strength and courage.

Compiled by Miss Dee, On behalf of Matsobanemetja Business Consulting (Pty) Ltd – Coaching division.

For any queries www.matsobanemetja.co.za

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A business is brought to life by an individual/s. As you are starting the company you must fulfill the roles and perform the duties of all the various positions in your company departments.

You become the CEO, Marketing Manager, Public Relations Manager, etc all at same time. This is because due to lack of funds you might not afford to pay salaries yet however as the business grows you gonna need some extra hands to assist in building the company further.

The question that mostly arise from entrepreneurs is that it becomes difficult to work with other people or the handing over of work. And understandably so, i mean you are so used to be hands on in every aspect of your business from pushing sales, invoicing clients, briefing clients, etc and all of a sudden you need to delegate, divide the work and trust the next person to deliver as you would. It is not an easy assignment to carry out but it needs to be done for the growth of the business. In response to this frustrations the one factor i advise them to look into is the Organizational Culture.

   

What is Organizational culture?

Organizational culture is an idea in the field of Organizational studies and management which describes the psychology, attitudes, experiences, beliefs and values (personal and cultural values) of an organization. It has been defined as “the specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization.”

Employees are not the only people you will interact with. Before you have to deal with them you would have dealt with Customers, Suppliers, other Business Owners,etc. All this individuals are very special in your business and you interact with them on different aspects and levels of your business. By the time you acquire assistance and employ extra people you would have mastered the act of dealing with any of them and those methods you will then pass to your employees – this to me i define as Organizational culture. You will develop this cultures because of the experience you had with them, and as having to have worked with them first hand. Therefore to me as the Business Owner you should be the founder of a series of this values and beliefs through your experience.

This definition continues to explain organizational values also known as “beliefs and ideas about what kinds of goals members of an organization should pursue and ideas about the appropriate kinds or standards of behavior organizational members should use to achieve these goals. From organizational values develop organizational norms, guidelines or expectations that prescribe appropriate kinds of behavior by employees in particular situations and control the behavior of organizational members towards one another.”

For example, you gonna need to pass step by step the rules or a manner of the project execution. For our employees to follow through this organizational Cultures, they will need a very extensive training whether you have hired them on the basis of experience or not so they can adapt to your own set of culture accordingly. See this as an investment. It might take away a lot of time from you and you will seem to follow behind with your schedule but believe me once the one employee master it then they will be able to pass to the next employee.

Two things that need to be done by us Business Owners. It is to be Transparent and to practice Consistency at all times.

Transparency – Your true character as an individual must be known by the people you work with. This makes it easy for them to understand you better, and that will be easy for them to follow through with your organizational culture. For an example: I am known by my business associates and employees as having a “serious personality” or as “a perfectionist”. As much as i tried to deny or find myself explaining this sort of “my personal traits” i just can’t hide them, they define who i am, they automatically happens and therefore this traits have assisted a lot in them understanding me and my work.

Consistency –  When you  have developed those set of rules to practice in your business you must stick to them always. Do not allow favours to family members and friends at the expense of the business. Because once you allow that to happen it is going to be tricky to try control their misbehaves. It is no secret that families and friends like to take advantage, not realising that with business things are different. If you have failed being consistent in your business how do you expect the people coming in to? Set a good example and Practice what you preach.       

Compiled by Miss Dee – On behalf of Matsobanemetja Business Consulting (Pty) Ltd, Coaching Division.

For any queries please get in contact with us here www.matsobanemetja.co.za

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What do we do after registering our Companies?

A business starts with an idea. Then you gather equipments and resources such as Capital or Material needed to start trading , but before trading , we are required to register this business idea. We register with CIPC ( Companies and Intellectual Property
Commission ) formerly known as CIPRO.

Why do we register a business idea?
In simple form,we operate this businesses in a country that has Business Laws under the Companies Act of the country. Once a business is registered , it means it has all the legal
entities allocated to it for recognition, identity , development and for protection. Think of it like this: When a child is born, they need an identity in the form of names, parents, ID numbers ,etc. The same applies with companies.

So now that the business is registered ,what is the next step?Trading right? Yes. But do we only focus on trading and never mind the other factors included in running the biz? Definitely not!

As we are now bounded by the law we need to follow suit.

Below are just the basics that I prefer and encourage each and
every Business Owner to know and understand after registering their companies

1. Ever heard of the South African Revenue Services (SARS) and what it stands for?
This is the institution not to ignore as a Business Owner as well as a responsible citizen. I mentioned the words “LEGAL ENTITIES” on the above paragraph. Once your company is registered , you receive the documentation that details the legal entities of the company.One of this legal entity is the FINANCIAL YEAR END.The financial
year end means a month you have chosen when you register your company that you will submit your ANNUAL RETURNS to the receiver of the revenue.
For example, if you have chosen February ,this means, every year in that month you are expected to file your TAXES. What does it mean to file your taxes? You have been trading,making profit,incurring expenses, etc.so now you must prepare your Company ‘s Financial Statements according to the transactions you have recorded
during the year.This financial Statements include the following :
The Balance Sheets which determines the business position and
The Income Statements which determines the business performance.
Once this is worked out , you then submit these reports and SARS will determine how much you must pay as your tax contribution. Please note: The Tax amount will be calculated as per your Taxable amount as per the provided Calculations on your Financials, and the percentage varies from nature of the business, etc and changes every year. Currently (2016) Small Business contribute 25% of their taxable amount towards taxes.
Whether you are trading or not, you must file .If you are not trading , you must also submit, but in that case, you will file zero instead.
When you don’t file ,that means you are not in good books of the law and you will be referred to as Non-Compliant .Being non-compliant is a disadvantage as you will not be receiving the compulsory
documentation ,such as TAX CLEARANCE CERTIFICATES,etc.

2. The next one I want to highlight is CIPC, see the full name above. With this type of tax you are also expected to file annually to the institution .The difference with them is that they expect you to
file on the anniversary of the business ,meaning every registration date of the company you must file. However, their standard fee is R100.00 per year for small companies that make less than R10 million per annum.A penalty of R50.00 is charged for late submissions.The reason for your company to comply is to inform
the Commissioner that your business is still active and they still have the correct business details on their database. Failure to do so ,other than penalties added on every year, your company may be DEREGISTERED. When a company is deregistered, it means it
is no longer valid. Thus, as a Business owner you really need
to make sure that this is in order to avoid the stress of reinstating or starting registering the company from scratch.
I have witnessed many Business owners lose opportunities and watch deals passes by because they are not in good books with the law.It is frustrating and a regrettable thing to go through.You do not
need to be an expert in these fields, but you just need to understand the basics ,or you can have an Advisor,a very good Accountant or a Bookkeeper to guide you ,especially in this field.

There are many Compliance stages in Business. I just chosen the two as they are basic and compulsory for every business. Know the nature of your business, familiarise yourself with all it’s compliance or licences required to run the business, by so doing you will be placing your business ready for opportunities and beyond.

Every business must strive for growth, in fact that is the main principle and goal of the business. Therefore non-compliance tend to block your Business for development and progress.

Compiled by Miss Dee. Do you have queries? Need advices / Tips?

Contact us www.matsobanemetja.co.za

CIPCandSARS

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The four upcoming Blogs will serve as awareness or an alert to fellow Business Owners, Entrepreneurs, etc of some factors to avoid doing in order to allow progress and growth in their Businesses.

This series of Blogs are inspired by some information we came to learn about through our Bookkeeping Fundamentals Workshops.  

We have learned a lot that some Business owners though they have registered their companies they do not raise an invoice for the services they have rendered instead they do this informally.

They just engage with their clients verbally and tell their prices via your Whatsapp messages, smses, Facebook Inboxing, etc. As much as this methods of communications are less expensive and convenient but that should not mean we must compromise the formal and professional way of doing business.

When you have registered your entity, you have a legal identity for it and should be known and recognised by people you are doing business with. Not only that but it is legally binding as well and furthermore i believe that you are only blocking yourself from success, growth and many  opportunities that may come your way. We run our Businesses in a country that have laws, rules and regulations for companies operating in the country and you have no choice but are legally bound by this rules.

Secondly, the use of e-wallet, Shoprite or other retail payments for Business is also not acceptable in Business. A proper business must have a Business account which you may reflect on your invoices.The reason of dodging bank charges or wanting to pay a minimal Tax amount is a sign of a planned failure according to me. I am saying this as i know you are completely limiting yourself from growth.

You will in future be looking for tenders, funding or even investors. This kind of opportunities are always looking at ways of the business run. Financial Management remains the core drive for their decision making. How do you prepare your Business Financial Statements with ewallet information, no invoices, no bank statement or Bank Statement  with missing information?     

It easy to create a valid invoice. Simply google an Online or Excel Template that is editable and fill in your Compulsory  Business legal entities. See below to guide you how to prepare a valid Tax Invoice.

VALID TAX INVOICE

The following information must be reflected on a Tax Invoice for it to be considered valid:

Contains the words

•  Tax Invoice (and the word must be on a prominent place)
•  VAT registration number (If applicable)
•  Name, address and VAT registration number of your Company
•  Name, address and VAT registration  number of the client or supplier
• Invoice number
• Date of issue of invoice
• Accurate description of goods or services
• Quantity or volume of goods or services supplied
• Value of the supply
• The amount of Tax charged and the consideration of the supply (Only if Vat applicable, In SA is at 14% )

Additional info:
This info is to make it easy for people you do business with.
• Contact details
• Bank Account details
• Social Network names / identity
• Company Logo
• Web address, and any other info that you regard valuable to be on, but the first part is extremely important.

Opening a Bank Account:

Visit a preferred Bank of your choice to open a Business Bank Account with the following documentations

• Proof of adress of less that 3 months

• ID Book

• and you Compamy Documents (CK)

For advices you are welcome to contact us here www.matsobanemetja.co.za

Compiled by Miss Dee On behalf of Matsobanemetja Business Consulting – Coaching Division

VAT is another type of TAX of which anyone as the consumer living in SA pays. But in business you may only register for it when your business is making up to 50K per annum and over.

During my interactions with business owners through our Bookkeeping Fundamentals Workshops or Client Consulting, i have observed that many still do not understand what this type of tax means and it’s implications, to a point where some are VAT registered Vendors but do not comply with the rules set by the Receiver of Revenue and they find themselves indebted to SARS and labelled as Non-Compliant and even blocked from accessing some necessary legal documentations from SARS.

My plea is as a business owner please take your time to understand this type of tax before you become a VAT registered vendor. Let me explain below the meaning in basics before i tell you one of the scenarios i had to deal with.

VAT stands for Value Added Tax. Value Added Tax is levied on the supply of goods and services by vendors or it is a tax businesses charge when they supply their goods and services. We have to pay VAT on most of the things that we supply. The VAT standard rate is 14% in South Africa.

There are two types of VAT: VAT Input and VAT Output

VAT Input means when a company buys goods or services from another supplier, VAT is charged on the purchase price that is known as Input tax. This account will usually show a debit (the VAT SARS) “owe” you money for the VAT you have paid and you are entitled to receive from them.

VAT Input is VAT on sales and income and must be paid over to SARS. It is vat that you pay on all your business expenses and for which you have a tax invoice. It also relate to vat that is paid on other goods and services bought or rented for the business. If input tax is greater than output tax the company can claim back money from Customs and Excise department – SARS.

VAT Output means when the company sells its own goods or services it charges its customers VAT this is Output VAT.

VAT Output is VAT paid on items purchased and can be claimed back from SARS. It is VAT, which your company would charge on items, which it sells. Thus a company could wish to sell on item and added to the amount a standard rate tax would be charged.

In the Vat settlement you deduct input VAT from output Vat. The resulting amount must be reported to your regional tax office. As you can see, you only pay tax to the state on the ‘value your enterprise has added to the goods”.

If your purchases exceed your sales in any one period the difference naturally is refunded.

I have had an instance where a client thought the VAT amount increases their Profit and this is not the case. Any form of Tax is a Liability. If you are going to charge the 14% VAT on your invoices this means you are acting on behalf of SARS as their agent collecting the VAT from the consumers of goods as it will be done vise versa with you in your business dealings. I realised this during my client Consultation, i was analysing their prices in terms of Cost of Sales, Selling prices, and their Profit margin. As i was scrutinising this elements and their decisions towards their pricing because their prices did not make any business sense to me, a very low profit was made in their business and i had to advise them to increase their prices. They insisted that they rather not but instead register for VAT because the fear of being a bit expensive to their competition was getting to them, something i have realised that it is a fear to many but a topic for another day.Then i asked what has the VAT amount has to do with anything in your profit? “Because Sis Dee our profit will be a little bit more” . Please note: The Vat amount you charge on your invoices is not yours – Ever. Do not make that mistake. Yes it will affect or contribute on your selling price because your profit will seem to be a bit higher but the key is ANY FORM OF TAX IS A LIABILITY, you are temporarily in possession of the VAT amount. Therefore you need to always deduct it from your profit never ever mix or relate it with your Business Finances. Please make sure you are happy with your selling price before you add the VAT amount on any of your products or services otherwise you will be compromising your prices as you will have to still deduct the VAT amount to the Receiver of Revenue.

Advise /Tip: If you deal mostly with suppliers that are not VAT registered while you are you will forever be indebted to the Receiver of Revenue. The VAT amounts need to contra out with those of your suppliers but if that’s not the case you will always owe SARS the VAT amount you have charged out. Refer again to the above explanation on VAT Input and Output to understand this implication.

Please find an Accountant or Bookkeeper who will explain this implications and who will advise you accordingly before your decision to register for VAT.

Compiled by Dikeledi Seoloane “Miss Dee” – On behalf of Matsobanemetja Business Consulting – Coaching Division.

www.matsobanemetja.co.za

I am sure by now you already know that the Funding Institutions or Investors do require either your Financial projections or the actual ones if you are trading already before they can assist you.

You might know the reason for this but i just wanted to share with you as to what exactly matter to them when they read your Cash Flow Statement.

Cash Flow is the most important part of your Financial Statement, as they use it to trace the flow of funds into and out of your business. The Primary purpose is to provide the information regarding the company’s cash receipts and cash payments. Those who want to work with or assist you in the business want to see the level of your responsibility towards the company’s finance. Your irresponsibility might cost them a lot of money they have invested into your ‘soon to die’ business something that could have been avoided. No one want to invest in such reckless spenders especially those that do not respect the monies of the company.

The pattern they use to trace the Company’s cash flow is simply that if they see there was a huge deposit of money from clients as a result of sales and in no time the money is gone. Theirs will be to evaluate the reason for the quick disappearance of the money. The three elements they use to see if the money was spend recklessly, they search if the money was used for either of the following: Operational activities, Investing activities or Financing activities. If the disappearing of money has nothing to do with this three criterias then they are sure that the money was wasted. See below what the three criterias include.

Operating Activities means if Sales and Services Revenue have been receipted and they are therefore used towards Cost of Sales, Selling Expenses, Administrative Expenses are paid, etc. Thus it will be understandable to anyone reading your Cashflow that the money went out towards Operational costs.

Investing Activities means you could have used the money either for Investing in other Companies, which this means you are interested in growing your brand or your company as the investments will be rewarded in the future.

Financing Activities could be that you used the money to repay the company debts, borrowing of funds or capital injections.

You therefore need to be careful of your spending habit. No one will want to buy into the company that will die with their money because of the irresponsible spending of the owner. You need to account for every cent coming in or going out of the business.

Compiled by Dikeledi Seoloane – On behalf of Matsobanemetja Business Consulting.

http://www.matsobanemetja.co.za

It is understable that most of us start our businesses by acquiring debts in the name of Capital, Loans, Fundings, etc. But be careful not to fall in the trap of religiously acquiring this debts for your business to operate because it can’t be how wealth is built.

Capitals, Loans, etc are classified as Liabilities, so this means your business is obliged to pay the funds back which they charge you interests even.

Once you borrow money for your business you need to guarantee that your Sales profit will be able to pay back the borrowed money and still left with cash in your business to be able to continue with business operations, that way you are guaranteed that when finished paying the debt you will be the independent owner.

The unfortunate thing and injustice that you can do to yourself  and business is that when you are unable to pay back and the business is not trading well, you will opt to selling the business or portion of it.

As much as selling makes a lot of sense at that time but in actual fact it will mean that you will be losing some part of the business that you have worked really hard for.

When you have started your business with borrowed capital make sure paying down the incurred debt is the critical first step.

The main objective of business is to make PROFIT. The profit that we are going to use to pay the business debts and grow the company. Business has to be surviving on it’s own sometimes, it should not always depend on borrowings, especially for smaller things. For example: If you find yourself borrowing money to buy stock every time then know that there is some unhealthy discrepancy in your business, as that will simply mean if you are not given any credit there will be no business running for you. It is no Business sense.

It is advisable to do your homework before taking a business loan. Work out your Operational Cash Flow appropriately according to the nature of your business. The two most factors that you need to focus on when drawing your projections should be Sales and the Cash Flow because they will assist you in making the good decision.

Do not get into the habit of growing your business on debts.

Compiled by Dikeledi Seoloane – On behalf of Matsobanemetja Business Consulting (Coaching Division)

Facebook: Matsobanemetja Business Consulting

Web: www.matsobanemetja.za

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A Business exist for clients and because of them. Without them, we have no business. Otherwise who are we going to service? No one. 

But the problems don’t begin with customers. They start with you and your employees. When customers expect a fantastic experience but receive a third-rate one, you can lose them forever.

I personally as a Business Owner / Entrepreneur think this is the basic and an obvious known fact which means we shouldn’t even be discussing who is important here. Because i think when you first decide to employ people you need to employ people who are either qualified, have the experience and people who understand business in general.
But I choose to see that as only the foundation, meaning there is still something to be done and continuously so, just to avoid the risk of poor customer service and ending up losing business. As a Business Owner it is your responsibility to make sure that such happen in your organisation.

Here are ways that employees can assist in achieving perfect customer service:

1. Get on board with the fact that employees are your most important customers

Sure, they may not be your main target in terms of who is buying your products and services. And, yes, YOU are paying THEM. Minor details. The truth is that your employees are the audience for your strategy. They are the people, if treated right and armed correctly, who will authentically translate your message, your vision, and your brand to the paying customers you’re after. So you better make sure they understand it and are emotionally connected to it!

2. Explain to employees WHY it is most important

Before asking your employees to take on something new or deliver a certain kind of customer experience, you must explain WHY it is so important. Show them why it will help themselves, the customer, and the company, and why they are so instrumental in driving the business outcome you want to achieve. Too often leaders try to engage people from the point of view of the company. Instead, we must shift our thinking to center around the point of view of the employee. How can we communicate in ways that are relevant and motivating to them? If you engage your front line the right way, the experience they deliver to customers will shine. So, start with the WHY, and then follow with the WHAT and the HOW.

3. Make sure the Training is taken seriously

One of the biggest mistakes companies make when developing training to build employee knowledge and skills is not identifying what they actually need to be trained on, how they best receive information, or how the program impacts the customer  those employees serve.

Traditional classroom training is not the answer for front-line workers today. So, what it?. What you really need to do before designing training is to go into the field and literally observe what’s happening. Go watch your people in action. Talk to them.  Hear what they have to say! Where do they excel? Where is there room to improve? How do they interact with one another? User-centered training is designed with all of this data in mind, rather than what’s on the mind of the training developer or even of company leaders. Connecting training with the company strategy and designing it with the end-user and desired outcomes in mind is the most effective way to empower people to execute your brand promise at the front line. Investing time, effort, and money into this process will yield a much more effective training development effort, more engaged employees, and much better customer interactions.

Ultimately, many leaders’ biggest shortcoming is viewing the world from their perspective and their perspective, only. The shift that’s most crucial is the one where you change the lens through which you look at the company, the employees, the strategy, and the brand. If you start by thinking about how your people might think, feel, react, respond, or behave, you will find yourself way ahead of the winning customers for life game. The customer experience will never exceed the employee experience; employees are truly your most important customers. It’s time to start treating them that way.

So you see, when employees are taken care of and are equipped with the necessary skill and knowledge there will be no need for customer service complaints.

Compiled by Dikeledi Seoloane – On behalf of Matsobanemetja Business Consulting (Coaching Division) 

Facebook Page: MATSOBANEMETJA BUSINESS CONSULTING 

http://www.matsobanemetja.co.za
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Personally i will always advise to start on your own first before you take the decision to share ownership with someone. My reasoning is also backed up by the experience. I witnessed so many conflicts between shareholders or partners ever since my practise. Companies have been dissolved as a result.

Business is not easy, whether you have partners or alone. There are many things that you learn along the way as you start being operational and some lessons are just painful to experience or even scarier before you start, this might be the reason you want to start with someone because your thinking will be that it is better when you share the pain or you thinking it is safe. But i think it is even more complex when you have partners. Therefore get experience first before you want to partner with anyone in your business. Learn how to manage your emotions first, learn independency, decision making, learn how to manage business relationships, learn the nature of your business in operation, learn the type of partners in business and choose the better one that will work for both of you.

LEARN BUSINESS FIRST.

Since my practise i have and still amend companies as a result of relationships gone bad between business partners. Some is even before the company start being operational.

The thing is, things always looks easier in theory than in practise.The planning does sound simple and accommodating but seem different in the execution and unfortunately this is learned during the business most of the times, this is where the conflict arises in most cases. I really think the most painful thing is having to realise that you and your partner do not share the same vision of the business or life in general and this could have be avoided if you had given yourself some chance to learn few things before you look for partners. Things like their characters, their spending habit, their interests, etc. Sharing the same passion does not automatically makes you good partners.

I always compare the shareholding or partnering in companies with marriage. It doesn’t matter how long you have known your partner for, because as soon as you get married to each other there are new things you will discover about one another now that you are closer to each other, i have heard this many times. Suddenly there are adjustments in your life, there is more you need to share, things like your whereabouts, financial decision about your ‘own money’, etc.This are things that you were never used to do before. You will always have to consult with your significant other before some decision making. Now to me for the marriage to succeed is you must be ready mentally, physically and  emotionally to be able to fulfill what is expected in the companionship. Get your mind ready because if not this will be the cause of the break-up (divorce), of which i never heard of a “beautiful break-up” so therefore this will always cost you many things.

In this i also advise that when you have started trading on your own and ready to partner please leave your principal business alone, it is better if you start a new entity that will accommodate the partnership. Protect your already existing business. This is in case the partnership does not work then you don’t loose the company that you have worked hard for on your own.

I am not saying you must anticipate partnering failure but what i am saying is this things happen, i see them at my disposal almost everyday. You can only use your existing company only if the factors around partnering forced you to but you will also have partnering terms in place.

And also not all new partnerships fails and the reason could be that there were more correct measures taken in consideration in the formation of the partnership. There are more technicalities in running a Business, do not form partnerships because we are just too excited.

By Dikeledi Seoloane on behalf of MATSOBANEMETJA BUSINESS CONSULTING – Coaching Division.

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www.matsobanemetja.co.za

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