Are you looking for a good business idea that will bring you some …
January 6, 2021
Author: Ekemini Ekpo
In this article, I discuss with you the right time to seek funds …
January 6, 2021
When to Go For Funding In Your Business and Why
Hair making business is one of the most lucrative businesses that you can …
January 5, 2021
How to Start and Grow a Hair Making Business
Would you like to own a fast-food franchise in Nigeria? Well, a fast-food …
January 5, 2021
How To Own A Fast-Food Franchise In Nigeria
There are several advantages and disadvantages of franchising a business. This article explains …
January 5, 2021
Advantages And Disadvantages Of Franchising A Business
Many Nigerians find it hard to differentiate between fixed deposit and treasury bill …
January 4, 2021
Fixed Deposit Vs. Treasury Bill In Nigeria: What Is The Difference?
![Small business owners and entrepreneurs are known to be very busy people always having so many things on their schedule. If they are not attending to clients and customers, they would be busy marketing/advertising their products and services. In the bid to spread their brands, take part in the selling process or tackle management issues, many small business people disregard the legal requirements of operating a business and make a lot of avoidable legal mistakes. They fail to realize that legal missteps are one of the top reasons for business failure. As you might have known already, IGNORANCE IS NO DEFENCE (IN THE COURT OF LAW)! For small businesses, especially in critical sectors like medical care, food, e-commerce, and insurance, it is very crucial to focus on the legal aspects of running a business. This is because not knowing these legal requirements or obligations can bring down a startup and as a business owner, you do not want that to happen to you. In this article, I discuss ten (10) common legal mistakes you should avoid as a small business owner. 10 Common Legal Mistakes Small Business Owners And Entrepreneurs Make and how to Avoid Them. (1) Not using a lawyer. A lot of small business owners and entrepreneurs believe that they do not need to involve the services of an attorney at the start of the business like the bigger entrepreneurs do. They believe that legal issues will only emerge when their business becomes bigger, so they can get a lawyer later. This is an enormous mistake that can cost you a large amount of money if not your organization. So it is better you get an attorney before you launched your business, irrespective of the scale of the business. The lawyer would help you to understand the legal obligations and requirements of your business and how to go about it properly. Speaking on this, Ramzy Ladah, the CEO of Ladah Law once said, 'A lot of soloenterprenuers and partnerships mistakenly believe that they do not have the same legal obligations that bigger enterprises have. They believe that legal issues will only arise as they scale, and they can always bring in an attorney later on. This is a huge mistake and one that can cost you your company, if not buckets of money. Get a lawyer before launch, and let him or her get you set up correctly from the beginning.' (2) Not Tracking Expenses. Another legal mistake commonly made by small business owner and entrepreneurs is not keeping track of their small or large expenses throughout the year. Most business owners only try to collect receipts when tax returns are to be filed. Hence, what is not documented is not deduced thereby leaving money in the open. There are many ways approaches to keeping records of expenses. Entities should hire professional accountants for stock, inventory management. This will help to curtail a business’s expenses if the volumes are quite high. (3) Not Having “Terms and Conditions” To Which Customers Agree To Be Bound. Term and conditions policies often regarded as “Terms of Use” or “Terms of Services” are a set of policies that explain what your business expects from your customers and what the customers can expect from your business/company. If your business does not have this policy written and published for customers to read before making a purchase, then you'll end up spending a lot of money to resolve issues between you and your customers if such arise in future. (4) Failure to Have a Privacy Policy. According to, www.privacypolicy.com, A privacy policy is a legal document that includes information on how a company collects handles and processes data of its customers. It simply describes whether information about customers is kept confidential or shared with third parties. As such, you have to inform your customers before sharing their contact information like their email, phone numbers and biometric data with another company. A privacy policy must be disseminated publicly. (5) Lack of Documentation. Most small businesses do not keep documents of what has happened in their company. This can break a crucial deal of business and cause issues to mount up in future. You must have a register to keep records of all interactions in the business. This amongst other advantages helps to keep you and your business in check, expenditure-wise. For a comprehensive list of documents that your businesses must have to operate legally in Nigeria, please check my free report on essential legal documents every your businesses must have in Nigeria. (6) Lack of Compliance to Security Laws. Most small business owners and entrepreneurs usually issue shares to family members and close friends without complying with the specific laws usually in the haste to spread their brands. What many of these business owners do not know is that they did this Shares and other securities issued without following the specific disclosure and presentation requirement could lead to serious legal problems. You might want to avoid this in your business. (7) Not registering Your Business. As an entrepreneur, it is very crucial that you register your business because its importance can never be overemphasized. Registering your business gives you a unique identity, makes you look serious to your customers. As a matter of fact, you must your business must be registered with the appropriate organ of government, in this case the Corporate Affairs Commission (CAC) before you can obtain serious loans and get quality investors to invest in your business. Above all, registering your business projects you from personal liability. If you register a Limited Liability Company [LLC], make sure that you get a name verification before making a brand logo, banner, business card, or building a website. This is very important and a concrete legal requirement that you must meet. For details explanation of the process to get how to get Certificate of Business Incorporation for your business in Nigeria, please see this guide (8) Not Hiring Employees Correctly . In the bid to find the employees, many business owners end up not following the proper procedures for hiring the right employees. Recruiting ideal workers is a critical part of your achievement in business. Therefore, you must have proper documentation in place when hiring people. These include employee handbooks, benefit forms, offer letters, and operating procedures for jobs. While this might take you time to create, it will save you a lot of money, time and other valuables and offer protection to your business. (9) Mixing Personal and Business Expenses. Business and personal expenses often become indistinguishable for startups. This is one of the major sources of confusion for small businesses especially when taxes are filed in. This often leads to income authorities canceling various deductions on an ad hoc basis resulting in a higher tax expenditures levy. To avoid this, small business owners and entrepreneurs should have separate records and financial accounts from the beginning. (10) Reliance on One Key Customer. This is a great mistake made by most small business owners. They tend to rely on one key customer especially if the client is a government. This is very deadly as a change of government or policies can cost you a lot if not break your business. Even if the key client is not the government, the person or entity can fail in his/her/their business dealings which might lead to your failure too. Okay, let's wrap up… Starting a business is really intriguing yet challenging. While focusing in how to spread your brand, you should also take note not to make costly mistakes as you start. This is because if you avoid these mistakes, your business has more chances of moving smoothly from the beginning and growing steadily from there. But this doesn't mean your business will not experience problems. As a business owner, be ready to experience some little challenges here and there. As a business you should try as much as possible to comply with the legal requirements needed when starting a business. This will help you to avoid the majority of the legal mistakes which small (and even big) businesses make and the punitive measures that come with making these mistakes. With the right education, mentorship and advice like the one I give in this article, you will so well and surmount any challenges that might come your way. Talking of business education, I like you to see an article I published lately on business schools in Nigeria near you. You might want to enroll in any of the nearby business schools to widen your entrepreneurial and managerial horizon. Trust me, the benefits are grandiose., Small business owners and entrepreneurs are known to be very busy people always having so many things on their schedule. If they are not attending to clients and customers, they would be busy marketing/advertising their products and services. In the bid to spread their brands, take part in the selling process or tackle management issues, many small business people disregard the legal requirements of operating a business and make a lot of avoidable legal mistakes. They fail to realize that legal missteps are one of the top reasons for business failure. As you might have known already, IGNORANCE IS NO DEFENCE (IN THE COURT OF LAW)! For small businesses, especially in critical sectors like medical care, food, e-commerce, and insurance, it is very crucial to focus on the legal aspects of running a business. This is because not knowing these legal requirements or obligations can bring down a startup and as a business owner, you do not want that to happen to you. In this article, I discuss ten (10) common legal mistakes you should avoid as a small business owner. 10 Common Legal Mistakes Small Business Owners And Entrepreneurs Make and how to Avoid Them. (1) Not using a lawyer. A lot of small business owners and entrepreneurs believe that they do not need to involve the services of an attorney at the start of the business like the bigger entrepreneurs do. They believe that legal issues will only emerge when their business becomes bigger, so they can get a lawyer later. This is an enormous mistake that can cost you a large amount of money if not your organization. So it is better you get an attorney before you launched your business, irrespective of the scale of the business. The lawyer would help you to understand the legal obligations and requirements of your business and how to go about it properly. Speaking on this, Ramzy Ladah, the CEO of Ladah Law once said, 'A lot of soloenterprenuers and partnerships mistakenly believe that they do not have the same legal obligations that bigger enterprises have. They believe that legal issues will only arise as they scale, and they can always bring in an attorney later on. This is a huge mistake and one that can cost you your company, if not buckets of money. Get a lawyer before launch, and let him or her get you set up correctly from the beginning.' (2) Not Tracking Expenses. Another legal mistake commonly made by small business owner and entrepreneurs is not keeping track of their small or large expenses throughout the year. Most business owners only try to collect receipts when tax returns are to be filed. Hence, what is not documented is not deduced thereby leaving money in the open. There are many ways approaches to keeping records of expenses. Entities should hire professional accountants for stock, inventory management. This will help to curtail a business’s expenses if the volumes are quite high. (3) Not Having “Terms and Conditions” To Which Customers Agree To Be Bound. Term and conditions policies often regarded as “Terms of Use” or “Terms of Services” are a set of policies that explain what your business expects from your customers and what the customers can expect from your business/company. If your business does not have this policy written and published for customers to read before making a purchase, then you'll end up spending a lot of money to resolve issues between you and your customers if such arise in future. (4) Failure to Have a Privacy Policy. According to, www.privacypolicy.com, A privacy policy is a legal document that includes information on how a company collects handles and processes data of its customers. It simply describes whether information about customers is kept confidential or shared with third parties. As such, you have to inform your customers before sharing their contact information like their email, phone numbers and biometric data with another company. A privacy policy must be disseminated publicly. (5) Lack of Documentation. Most small businesses do not keep documents of what has happened in their company. This can break a crucial deal of business and cause issues to mount up in future. You must have a register to keep records of all interactions in the business. This amongst other advantages helps to keep you and your business in check, expenditure-wise. For a comprehensive list of documents that your businesses must have to operate legally in Nigeria, please check my free report on essential legal documents every your businesses must have in Nigeria. (6) Lack of Compliance to Security Laws. Most small business owners and entrepreneurs usually issue shares to family members and close friends without complying with the specific laws usually in the haste to spread their brands. What many of these business owners do not know is that they did this Shares and other securities issued without following the specific disclosure and presentation requirement could lead to serious legal problems. You might want to avoid this in your business. (7) Not registering Your Business. As an entrepreneur, it is very crucial that you register your business because its importance can never be overemphasized. Registering your business gives you a unique identity, makes you look serious to your customers. As a matter of fact, you must your business must be registered with the appropriate organ of government, in this case the Corporate Affairs Commission (CAC) before you can obtain serious loans and get quality investors to invest in your business. Above all, registering your business projects you from personal liability. If you register a Limited Liability Company [LLC], make sure that you get a name verification before making a brand logo, banner, business card, or building a website. This is very important and a concrete legal requirement that you must meet. For details explanation of the process to get how to get Certificate of Business Incorporation for your business in Nigeria, please see this guide (8) Not Hiring Employees Correctly . In the bid to find the employees, many business owners end up not following the proper procedures for hiring the right employees. Recruiting ideal workers is a critical part of your achievement in business. Therefore, you must have proper documentation in place when hiring people. These include employee handbooks, benefit forms, offer letters, and operating procedures for jobs. While this might take you time to create, it will save you a lot of money, time and other valuables and offer protection to your business. (9) Mixing Personal and Business Expenses. Business and personal expenses often become indistinguishable for startups. This is one of the major sources of confusion for small businesses especially when taxes are filed in. This often leads to income authorities canceling various deductions on an ad hoc basis resulting in a higher tax expenditures levy. To avoid this, small business owners and entrepreneurs should have separate records and financial accounts from the beginning. (10) Reliance on One Key Customer. This is a great mistake made by most small business owners. They tend to rely on one key customer especially if the client is a government. This is very deadly as a change of government or policies can cost you a lot if not break your business. Even if the key client is not the government, the person or entity can fail in his/her/their business dealings which might lead to your failure too. Okay, let's wrap up… Starting a business is really intriguing yet challenging. While focusing in how to spread your brand, you should also take note not to make costly mistakes as you start. This is because if you avoid these mistakes, your business has more chances of moving smoothly from the beginning and growing steadily from there. But this doesn't mean your business will not experience problems. As a business owner, be ready to experience some little challenges here and there. As a business you should try as much as possible to comply with the legal requirements needed when starting a business. This will help you to avoid the majority of the legal mistakes which small (and even big) businesses make and the punitive measures that come with making these mistakes. With the right education, mentorship and advice like the one I give in this article, you will so well and surmount any challenges that might come your way. Talking of business education, I like you to see an article I published lately on business schools in Nigeria near you. You might want to enroll in any of the nearby business schools to widen your entrepreneurial and managerial horizon. Trust me, the benefits are grandiose.](https://www.entorm.com/wp-content/uploads/2021/01/Legal-Requirements-When-Starting-Business-In-Nigeria-1-244x142.jpg)
Small business owners and entrepreneurs are known to be very busy people always …
January 4, 2021
10 Common Legal Mistakes Small Business Owners And Entrepreneurs Make
There are several retail business ideas you can start on a small scale and make …
January 4, 2021
Retail Business Ideas You Can Start on a Small Scale and Make Money
Legal documents are the documents which any business and smart entrepreneur must acquire …
January 3, 2021
The Legal Documents Your Business or Startup Should Have In Nigeria
As birth certificate is peculiar to you, so is Business Certificate of Incorporation …
January 3, 2021
4 Things About Your Business Certificate Of Incorporation You Should Know
To start with, what is a Credit Score? At least if we know …
January 3, 2021
Benefits Of Having A Good Credit Score
So, you want to be a personal trainer, probably a certified personal trainer? …
January 2, 2021
How To Get Started As A Personal Trainer
A school is a place where knowledge is acquired. As an aspiring entrepreneur, …
January 2, 2021
Why You Should Go To Business School As An Aspiring Entrepreneur
When you acquire useful business administration/management knowledge and add this to your skills, …
January 2, 2021
Best Business Schools For Aspiring Entrepreneurs
Buying property whether land or house is risky in Nigeria. Therefore, it is …
January 1, 2021
How To Buy Property In Port Harcourt
Business is the exchange of goods or services for money. Nigeria is a …
January 1, 2021
5 Steps To Owning A Business In Nigeria
The beauty of every business is when it is legal or operated legally. …
January 1, 2021
Legal Requirements When Starting Business In Nigeria
There is a word of wisdom that says; “you use what you have …
December 31, 2020
How To Bootstrap A Startup If You Don’t Have Money
Palm oil business in Nigeria is wide and almost all aspects of it …
December 31, 2020
How To Start Palm Oil Business In Nigeria
To start with, what are the marked differences between Venture Capitalists and Angel …
December 31, 2020
Why You Should Avoid Venture Capitalists And Angel Investors In Your Business
It may interest you to have a little prelude on the economic history …
December 30, 2020
What Sells Fast in Nigeria?
Today, I discuss with you five food business ideas that you can implement …
December 30, 2020
Food Business Ideas To Start Now In Nigeria
Many people think that one has to work in an oil company or …
December 30, 2020
What Are The Most Successful Small Business in Nigeria?
Being fit has a lot of advantages. Whenever I think of fitness, my …
December 29, 2020
Fitness Business Ideas in Nigeria
Would you like to property in Abuja? If your answer is Yes, then …
December 29, 2020
How to Buy Property in Abuja
Agricultural businesses in Nigeria are booming businesses. Before the discovery of oil, agriculture …
December 29, 2020
Best Places to Site Your Agricultural Businesses in Nigeria
Venture capitalist firms popularly referred to as “VC” are mostly needed for small-scale …
December 28, 2020
Venture Capitalist Firms in Nigeria You Should Trust
The first time I heard about dropshipping, I thought it was something that …
December 28, 2020
How To Start Dropshipping Business In Nigeria
To start with, we have to know what digital marketing is and why …
December 28, 2020
Digital Marketing 101 for Small and Medium Businesses in Nigeria
Let’s talk about how to register a copyright in Nigeria. Shall we? Ok, A …
December 28, 2020
How To Register A Copyright In Nigeria
Properties are what most of us have to think about at one point …
December 27, 2020
How To Buy Properties In Lagos
A name trade mark is the first thing people take note of in …
December 27, 2020
How To Trademark A Name In Nigeria
Trademarks are in different classes. This is so to distinguish between one class …
December 27, 2020
Types Of Trademarks In Nigeria
Are you looking for some of the best in-demand freelance skills to earn …
December 27, 2020
Most In-Demand Freelance Skills To Start And Earn Money In Nigeria
Patent is very similar to trademark and is an intellectual property also. Just …
December 27, 2020
How To Register A Patent In Nigeria
One can never know too much especially when it comes to skills that …
December 27, 2020
Digital Marketing Skills To Acquire In Nigeria This Year
Today, I am discussing with you the 10 best practices for email marketing …
December 26, 2020
10 Best Practices For Email Marketing For Small Business In Nigeria
Before I show you the top hospitality business ideas that I know of …
December 26, 2020
Profitable Hospitality Business Ideas You Can Start In Nigeria
Hello there! Do you want an extra source of income? Or, are you …
December 25, 2020
Top 10 Refer and Earn Apps in Nigeria 2020
Over the years, modern technology has been dominated by companies based in first …
December 24, 2020
Top 10 Blockchain Startups in Nigeria 2020
As e-commerce becomes more and more popular in Nigeria, never-before-widely-practiced businesses such as …
December 24, 2020
Best Dropshipping Platforms in Nigeria
Hello! You may have been thinking of going into e-commerce and have been …
December 24, 2020
Dropshipping and Mini Importation: Which is better?
Many who are about to register their businesses come to a point where …
December 23, 2020
Benefits of Incorporating Your Business
Are you a young girl seeking for ways to make money as a …
December 23, 2020
How to Make Money as a Girl in Nigeria
Generally speaking, manufacturing entails the processing of specific raw (input) materials into desired …
December 23, 2020
Best Places for Your Manufacturing Businesses in Nigeria
Whistle blowing is no more an entirely new concept in Nigeria following the …
December 22, 2020
Nigeria’s Whistle Blower Policy – Things to Know
Siting a Fintech Company is one thing but getting a good location for …
December 22, 2020
Best Locations for Fintech Companies in Nigeria
With the state of the nation at the moment, there is a definite …
December 22, 2020
What Businesses Can A Woman Do in Nigeria?
Today, I bring to you a collection of 40 specially selected business ideas …
December 7, 2020
40 Business Ideas in Nigeria That Will Make You Rich
Today, I want to talk to you about something that is very important …
December 7, 2020