Starting a business is a daunting yet exciting prospect. To some, entrepreneurship may give a thrill like nothing before. It could be an online store, a cafe, a retail outlet or anything at all. Regardless, there are a number of points to think about before you embark on the journey to entrepreneur life, which I will talk about in this article.
1. Target Audience, Product Offering & Business Model
First of all, consider your product or service and really think about the business nature of the company. It could be a great idea, but sometimes there may be better ways to sell, maybe in ways you have yet to think of. Traditional business models include direct sales, franchising, or a classic brick-and-mortar store. There may also be different business models that may be more suitable for your product or services.
Perhaps you could also consider a beta testing of your product or service! It is also advisable to do some competitor research within the industry to get a better understanding of your potential market. And don’t limit your thinking to the short-term: consider the long-term as well.
2. Type of Business Entity
The most common business entities that you can register under the Companies Commission of Malaysia (SSM) are Enterprises (Sole Proprietorships/ Partnerships) and Companies (Sdn Bhd or Berhad). It is important to understand the differences to know which entity suits your business best.
By incorporating a company, you will be able to protect your personal assets and finances, especially in the unfortunate event that things go south during your entrepreneur journey. Also, if you plan to incorporate a company with a few partners, it is important to put in place a shareholder agreement that lays out equity split, roles and responsibilities, fees etc.
3. Company Name
A simple yet unique name that represents your business will help cement your brand in the eyes of your customers. Ideally, it should be a name that delivers impact and is easy-to-remember. It should also be within SSM Guidelines, e.g. initials need to be elaborated in full (ABC Sdn Bhd, whereby ABC stands for Always Being Creative; John Doe can name his company John Doe Sdn Bhd only if he is a director or shareholder of the company and he cannot name it as James Doe Sdn Bhd). That said, the trade name of your product or service could be different from your registered company name.
4. Company Finances
It goes without saying that sufficient capital is essential, especially for businesses that are just starting out. There are many financing solutions such as bank or government loans for small businesses, accelerator programmes and venture capitalist firms available to help. As important as it is to secure funding, it is equally important to understand basic bookkeeping to plan for the business cash flow, as well as being able to understand your company’s financial statements in order to map out for your company’s budget.
5. Being an Employer
Sooner or later when you need extra hands in the business, you will eventually take up the role of an employer. Being able to find suitable help at the right time lifts a huge weight off your shoulders, especially when there are other issues pressing for your time. Job search portals may come in handy at those times. Don’t forget to stay compliant by registering your company with relevant authorities such as KWSP/ EPF and PERKESO/ SOCSO.
6. Staying Compliant
As a responsible entrepreneur, it is important to stay compliant within the regulations of the relevant authority. Some business activities require certain licences from the regulatory authority and it’s a good idea to apply for the appropriate licences before conducting any business activities. Company books and records also need to be kept in order, but if you have appointed a company secretary, he or she should be able to guide you on that.
I plan to incorporate a company, what’s next?
Great choice! You can either incorporate the company on your own on SSM’s MyCOID portal or use the services of a professional company secretarial firm that provides incorporation services.
- Sign up an account on MyCOID as an individual user. Once you have submitted your details, you are required to verify your identification at the nearest SSM office in order to activate your account within 14 days.
|You should bring along the following items: |
1. NRIC or Passport
2. A copy of the email from SSM – Notice to Verify Your Identification at SSM Office
- Once you have your identity verified over the counter, you may expect an email that provides access to your account, which will then allow you to reset your account credentials. Now you are ready to incorporate your company.
- Upon login, you may select ‘Direct Incorporation Application’ on the Dashboard. This process allows you to first submit a name application, then provide details of the company for the registration.
- Fill out the details as requested and click ‘Search’, remember that you can refer to the SSM Guideline on Company Names. New incorporation can fill out the form with ‘N – New incorporation’ as the purpose and ‘S – Limited by Shares’ as the type. If the name is available, you may proceed to submit the application.
- You will then be redirected to fill out the Superform. The fields to be filled out include particulars of the company, directors and shareholders, a declaration as well as lodger information. Select ‘Next’ and you will then be able to preview your application. You may then submit your application and make payment accordingly. The cost to incorporate your company on MyCoID is RM1,010.60.
- You may also separate your application by first submitting a name reservation via ‘New Name Reservation Application’ on the homepage of the portal. The approval for the name reservation typically takes between 1 to 3 working days. The fee to reserve a name is RM50 on the portal and every successful name reservation is valid for 30 days. If the company is not registered within 30 days, the reserved name will then be opened up for public adoption. Once your company name is approved, you may proceed to submit your registration to incorporate your company via ‘New Incorporation Application From Reserved Name’ on the dashboard. You will be able to see your approved company name on a list, and you may select ‘Incorporate’ to proceed. Fill out the details on the Superform, submit the application and you will be redirected to make payment.
- Once your company is incorporated, you will then receive an email from SSM with the subject ‘Notice of Registration’ if your company is successfully incorporated. This typically takes between 1 to 2 working days. You may then proceed to purchase the Certificate of Incorporation from SSM for your safekeeping. Congratulations on your new company!
Through an Incorporation Service Provider
This is typically a company secretarial firm or a law firm. The procedure may vary slightly depending on the service provider. With a digital company secretary such as Quadrant Biz Solutions, this is what you can expect as you embark on your journey to incorporate a company:
- After a basic consultation with their friendly team, you will be asked to submit a form that provides essential particulars regarding the company
- Quadrant Biz Solutions helps to review your form submission and quickly proceeds with a name search and reservation. An expected duration of 1 to 3 working days will be required before SSM approves the company name.
- Once the name is approved, Quadrant Biz Solutions then helps to prepare a Superform draft for your review, and proceeds to submit upon confirmation.
- Your company will be incorporated within 2-5 working days hassle free!
Reach out to the friendly team from Quadrant Biz Solutions here and get one month’s retainer fee free with the code KCLAUQBS.
Lastly, you should be aware that all newly registered companies are required to appoint a company secretary within 30 days of incorporation. Business owners should also plan for the annual expenses and statutory procedures to follow, such as appointing an auditor, as well as submitting Annual Return and Financial Statements to SSM. All the best!