Starting & Running

your Own business

Produced as a joint venture initiative by

Department of
Economic Development
and Tourism
KwaZulu-Natal
DEVELOPMENT FINANCE CORPORATION LIMITED
 contents

page

1 introduction 1

2 what drives one to start a business? 2

3 identifying business types 4

4 selecting the appropriate business entity 6

5 purchasing an existing business 10

6 developing a business plan 12

7 business finance 20

8 operating and managing a business 22

9 the franchise option 23

10 legal aspects 25
 introduction

South Africa faces many major economic challenges as it

continues infiltrating the global market.

Two such challenges include sustainable economic growth

and the significant reduction of unemployment within the
country. The development of the small business sector
is vital to this country and to vast numbers of its
economically active population, as this sector has emerged
as the engine room for both economic growth and
employment.

Given the importance of South Africa’s small

business sector and the daunting task individuals
face when starting small businesses, KwaZulu-
Natal’s development finance agency, the Ithala
Development Finance Corporation Limited
(Ithala), in consultation and co-operation with the
KwaZulu-Natal Department of Economic
Development and Tourism, has produced
this useful Small Business Booklet to guide
prospective entrepreneurs through the
fundamentals of launching and operating a small
business enterprise in South Africa today. It is not
designed to provide comprehensive answers to business-
related questions, but, instead, offers an insight to :

● business types;
● selecting the appropriate entity through which to do
business;
● purchasing an existing business;
● compiling a business plan; and
● business finance.

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 what drives one
to start a business?

To make a success of a business, one must be driven and

it is therefore important to start an enterprise for the right
reasons and with realistic goals in mind.

Before committing oneself, it would be useful to ask and

answer a wide range of questions, including those that
follow. Only then will one be sure about taking the first
step towards entrepreneurship.

● Why do I want to start my own business? – It is

important that you are honest with yourself and that
you establish the true reason for wanting to see
yourself in business.
● What kind of business would I like to operate? – You
must ensure that you have the necessary and relevant
knowledge and skills. This may involve you having
worked for someone else within a particular industry to
gain experience.
● Do I have the required knowledge, training, certificates,
interest, attitude and freedom to undertake a particular
business? – Once obtained, you should
undertake intense self-analysis.
● Is there a market for the products or
services I wish to deliver? – A brief market
survey in the area will assist you to
determine market needs.
● Where do I intend locating my business? –
It is imperative that you have a clear idea of
location; this plays an important role in
determining business success.
● Is it possible to operate my business from
home? – Is the business type such that you
need not operate from formal business
premises, thus saving on expenses.

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● Do I need to meet any requirements in order to work
from home? – Determine your local council’s by-laws in
this regard.
● When do I take the first step? – It is necessary to plan
meticulously for the day on which your business will be
launched. Don’t rush.
● When will I begin delivering my products/services? –
Determine when your business will be fully operational.
Plan to meet this critical deadline.
● Does business require a partner, manager and
employees? – You may need staff. You need to interview
and select staff who will complement you and your
business.
● What should I know about accounting and book-keeping? –
You may wish to contract with a book-keeping /
accounting firm to assist with the bookkeeping / record-
keeping of the business.
● From whom will I buy supplies? – Have you established
a relationship with prospective suppliers?
● What form will my legal structure take? – Should I trade
as a sole proprietor, close corporation, company or
partnership? Obtain advice from a firm of attorneys
and your accountant.
● How will I combine my personal life with my business
operation? – Starting a business requires personal
sacrifices. You must reconcile your family and yourself
to this fact.
● How much money do I need to start my business?
– Determine your financial requirements for equipment,
stock and working capital.
● How am I going to finance my business? – Determine
the level of self-funding you can afford and how much
loan finance you will require.

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 ● Where should I go for financial assistance? – Approach
financial institutions, such as Ithala and other
commercial banks. They will give you professional advice.

It should be noted that successfully answering these

questions does not guarantee business success.
Regrettably there simply are no guarantees. However,
those who take the time and trouble to answer these
questions, have a better chance of success than those who
do not.

identifying
business types
There are three general business types, namely
manufacturing, trading and service enterprises.

MANUFACTURING BUSINESS
A manufacturing business involves the processing of raw
materials and the production of finished goods or other
forms of raw material. An advantage of a manufacturing
business is that occasionally certain Government
incentives are made available, provided the necessary
requirements are met.

In establishing a new manufacturing

business an entrepreneur must face
and overcome a range of
constraints. One such constraint is
access to capital. Other issues to consider
include the availability of a suitable site, suitable premises,
adequate raw materials, appropriate infrastructure,
distance from suppliers and markets and the necessary
production expertise.

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 TRADING BUSINESS
A trading business involves the buying and selling of
already manufactured goods to the benefit of end-user
customers. Very few special Government incentives are
made available to entrepreneurs active in this sector.

An advantage of operating a trading business is that

detailed technical knowledge is unnecessary, although an
above average general knowledge of products is vital. It is
generally considered that establishing a trading business
is not as complex as launching a manufacturing concern.

SERVICE BUSINESS

A service business is any business concerned with the

supply of a service to customers, such as the provision of
personal advice, based on some special knowledge. A
service business is normally the simplest and most
inexpensive to launch, and would include such activities
as business consulting, book-keeping and accounting,
plumbing, carpentry and the like.

Entrepreneurship is defined as : “The pursuit of opportunity

without regard to resources currently controlled”.
Entrepreneurship is thus synonymous with the bearing of
risk and application of innovation. Entering business
inevitably carries a degree of risk, which may be offset
through an understanding of problems and constraints
associated with entrepreneurship.

In identifying which business type to pursue, it is necessary

to evaluate one’s knowledge, skills and interests within a
particular business environment.

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 selecting the appropriate
business entity

There are essentially four business entities in South Africa,

namely Sole Proprietorships, Partnerships, Close
Corporations and Companies.

SOLE PROPRIETORSHIP
(single person business)

A sole proprietorship is a business owned and operated by

a single person. This is the easiest, least costly
and least regulated type of business to access.
The proprietor has sole responsibility and
control, but is personally liable for all claims,
taxes and debts against the business, as well as
for injuries caused by or to employees during
their employment. This business entity may
expose the individual to litigation and is
normally only selected by smaller business
types.

PARTNERSHIP

A partnership is an incorporated business

owned and operated by two or more people,
but limited to 20 persons (natural or juristic persons)
except for partnerships of certain recognised professionals,
including accountants and attorneys, where up to 50
persons may be incorporated.

A partnership may be formed by way of a verbal

agreement between the parties. As with a sole
proprietorship partners are responsible for
any debts of the partnership. No other
statutory provisions govern partnerships. It is
important to be aware that each partner may be held

6
personally liable, just as in a proprietorship. In addition,
partners are taxed in their personal capacity. There are no
separate legal entities and no registration formalities exist
in relation to partnerships. Individuals may also carry on
business as sole proprietors.

CLOSE CORPORATION

A close corporation may be formed by at least one, but not

more than 10 members. The only persons qualified to
become members are :

Natural persons, a trustee of a testamentary trust who is

not a juristic person, trustee, administrator and executor or
curator for a member who is insolvent, deceased, mentally
disordered or otherwise incapable of managing his or her
affairs.

The objective of the Close Corporation Act of 1984 is to

provide for a simpler in-expensive business entity for the
single entrepreneur or a few participants.

The close corporation is governed by the Close

Corporation Act. The close corporation has a legal
identity distinct from its members. Each member stands in
a relationship of faith/trust to the corporation and may
become liable to the corporation for losses suffered as a
result of a breach of faith. However, unless the members
have signed deeds of surety, they cannot be sued in their
personal capacities for the cc’s debts and would thus not
be liable for such debts. When borrowing money,
however, most financial institutions would require
the members to sign surety for the debt. The members
may enter into a membership agreement to govern
relationships between them.

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 ADVANTAGES OF A CLOSE CORPORATION

● Formation : It is very easy to form.

● Liability : The members have limited liability.
● Taxation : Taxation is separate to that of the
members.
● Legal Entity : The Close Corporation retains a
separate legal identity from members.

DISADVANTAGES OF A CLOSE CORPORATION

● Membership is limited to not more than 10 members.

● Financial institutions may require sureties from each
member before granting a loan.

COMPANIES
All companies must register with the registrar of
Companies and comply with the provisions of the
Companies Act.
A company is treated as a separate and distinct unit from
its shareholders. A company may enter into contracts and
may sue or be sued in its own name. Legally it is treated as
an artificial person having rights and duties of its
own. This business entity is usually the most
costly to form. Further, audited financial state-
ments are required.

ADVANTAGES OF A COMPANY
● Liability : Limited liability for share
holders.
● Continuity : Transferability of shares and
thereby ownership.
● Credibility : Easier to raise capital.
● Possible to separate business functions into
different companies.

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 DISADVANTAGES OF A COMPANY

● More expensive to launch and maintain.

● Legal formalities are sometimes cumbersome.
● Control and regulations.
● Possible liability of shareholders.
● Private companies may not offer shares to the public.
Companies have share capital and may be divided into two
types, namely private and public companies.

PRIVATE COMPANY
A private company is one which, by its articles
● restricts the right to transfer its shares;
● limits the number of its shareholders (other than
employees of the company) to 50; and
● prohibits any offer for the subscription of any shares
or debentures to the public.
Private companies are recognised by the words
“(Proprietary) Limited” or (Pty) Ltd.

PUBLIC COMPANY
A public company is not subject to the restrictions of a
private company. The name of the public company ends
with the words “Limited”. A public company may offer
shares to the public. It must have at least seven
shareholders (unless wholly-owned) and at least two directors.

BUSINESS TRUST
Generally speaking, a trust is not a legal personality. It is
represented by the trustee who embodies it and holds title.
He/she deals with the property in which trust rights exist.
Contracts with regard to the rights and property affected
by trusts are the contracts of the trustee. He/she in person,
is liable for them. He/she is not acting as an agent or

9
 representative of another. He/she is acting for himself/
herself, but with fudiciary obligations to others. It differs
from a corporation or partnership, in that the former is a
legal person, whilst the latter is an association of
individuals united for transaction of business.

Co-operative
A co-operative is a form of business that is voluntarily
owned and controlled by its users. It is operated for them on
a cost basis. Examples of co-operative businesses are: farm
supply, financial purchasing, health, day care and housing.

purchasing an
existing business
Purchasing an established business is the quickest and
most direct way to enter the business environment.
However, thorough investigation is required in order to
avoid taking on the problems of other. The extent of the
investigation will depend largely on the size and nature of
the business. It is therefore crucially important to consult
attorneys. The following issues should be closely
investigated before any sale agreement is finalised.

REASON FOR SELLING

Establish why the present owner is selling. Very few
people sell their businesses if the enterprise is doing well,
although entrepreneurs enjoying success are forced into
selling because of age, failing health and the like. Extra
care should be taken should investigations reveal a
business is being sold because of poor performance or
location, a declining customer base, or similar problems.

10
 PURCHASE PRICE
Determine exactly what you are buying. Many different
assets are involved, such as equipment, machinery, stock,
land and building. There are numerous factors to
consider before assessing whether the selling price is fair.
A point of departure should be to closely examine audited
financial statements covering at least the past three years.
You should consider requesting sight of bank statements
and compare these figures against tax return reports and
investigate any discrepancies. Also consider interviewing
some of the Seller’s employees.

SETTING YOUR PRICE

Set the price you are prepared to pay for the business from
a financial perspective. There are various formulae used to
calculate the fair value of a business. Most selling prices
include aspects such as goodwill, the difference between
the book value of the assets and the selling price of the
business. Verify with your accountant whether the
goodwill is a realistic figure.
It is recommended that you consult with your accountant,
business broker or financier regarding a fair selling price
for the business.

OTHER THINGS TO LOOK FOR

● Thoroughly check the stock. Stock items may well be
old and/or damaged.
● Investigate any lease agreements, including the expiry
date and rental escalation clause.
● Thoroughly investigate the existing creditors and
debtors of the business.

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 ● Check the asset register, consider using a
knowledgeable person, such as a professional
business evaluator, to ensure all the assets of the
business are properly accounted for.

● Check with local authorities regarding licencing

requirements, permits and zoning.

● Establish whether there are any future obligations

such as guarantees, warrantees, unfulfilled contracts,
pending damage claims and lawsuits which would
affect the business.

➐ Investigate any new environmental standards that

will affect the future of the business.

● Check the agreements with employees and

customers.

developing a
business plan
WHAT IS A BUSINESS PLAN
A Business plan is a document which provides a detailed
programme outlining all the aspects that will impact on
your business, including the environment in which you will
operate. To a degree, a business plan is a selling
document and the description should therefore also be
attractive, as you will almost certainly use this document
to sell your idea to potential investors or bankers.

Drawing up a business plan is a time consuming, though

very necessary, exercise, but by doing your research, you
will learn a lot about yourself and the proposed business.

12
 THE IMPORTANCE OF A BUSINESS PLAN
It is important that you provide sufficient time to conduct
adequate research and to compile your business plan.
If prepared properly, this document will allow one to :
● Put your thoughts down on paper in a logical order.
● Address pitfalls in the planning stages.
● Measure performance against targets set in your plan.
● Use the business plan to apply for financial assistance.
● Use the business plan as an effective decision making
tool.
There are nine steps involved in the formulation of a
business plan.

STEP ONE –

PREPARE A COVER PAGE AND CONTENTS PAGE

The cover page should be well presented, business-like,

neat and professional. It should portray the following
information :

● Name(s) of the owner(s);

● Name of the business;
● The address and telephone number of the owner(s) of
the business; and
● Type of business.

The headings within the contents page should be clearly

detailed and numbered.

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 STEP TWO –
INTRODUCTION AND BACKGROUND INFORMATION

The introduction should be concise and interesting,

covering the following points:
● Describe briefly what you intend producing or selling;
● Where the business is situated;
● When you intend launching;
● Why you believe the business to be viable; and
● Short, medium and long-term business goals.

It is important that your introduction be brief, yet

addresses the above requirements.

STEP THREE –
PURCHASING PLAN
It is vital that you determine who your
suppliers will be and that you develop a
relationship with such businesses. In this
regard, you should address the following :

● Explain products needed to be purchased;

● Detail the suppliers from whom you intend
purchasing and highlight lead times
between the placing of orders and delivery
thereof;
● Explain the credit terms suppliers are prepared to offer,
if any; and
● Highlight the reliability of individual suppliers as
regards their ability to deliver.

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 STEP FOUR –
MANUFACTURING PLAN
(If applicable to your proposed business)
It is necessary to document exactly how you propose man-
ufacturing your product, detailing the facilities
available and the resources required. In particular, you
should address the following :

● A brief step-by-step description of the production

process;
● Provide a graphic layout of the factory floor;
● Provide a workflow diagram of the processes involved
in your manufacturing programme;
● List all the required equipment, clearly detailing the
production output of such machinery/equipment; and
● Detail the costing and pricing of the products to be
manufactured.

STEP FIVE –
MARKETING PLAN

Investors usually look very closely at this

section of a business plan prior to deciding
whether to invest. Because sales figures are
the most difficult to forecast accurately, these
figures are the most important to justify.

The following should be contained in the marketing plan :

Explain and substantiate your specific target market or
customers base. This may be broken down into
geographical areas, income groups, age and sex
groupings. It may be necessary to contact your local

15
 council or Central Statistical Services for the necessary
information. The following probing questions may assist
in determining your market, namely:
● Who are your customers ?
● Where are they ?
● Why do they buy ?
● When do they buy ?
Explain what market share you expect to capture
and why.
Determine your competitors and consider :
●Where they are;
●How long they have been in business;
●How much of the market they enjoy; and
●What are their strengths and weaknesses.
Explain any differences between your products/
services and those of your competitors.
Also explain how you intend packaging, selling and
promoting your products, detailing distribution networks.

Considering the above is necessary to enable you to

quantify your market in terms of monthly sales to
determine an annual sales figures for the first year. This is
normally the most difficult part of the business plan.
Contact your accountant or nearest Ithala office for
guidance.

STEP SIX –
FINANCIAL PLAN

One of the most important aspects in starting a business is

the preparation of a financial forecast.

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The financial plan should contain the following
information :

● A detailed income statement for a projected period of

12 months (see Annexure A for an example);

● From the income statement generate a monthly cash

flow forecast for the business (see Annexure B for an
example);

● Breakdown your financial requirements into three

categories, namely, building, equipment and working
capital;

● Reflect the amount of your own contribution/or funds

that you have available to invest in the business;

● Detail levels of security or collateral you have available,

providing an estimate of the market values. Fixed
deposits, fixed property, life policies with surrender
values, endowment policies are all reasonable forms
of security and are normally accepted by financial
institutions; and

● A complete set of financial statements reflecting at

least the past two years, should be attached in the case
of an existing business.

If you experience difficulty in respect of the financial plan,

it is advisable to contact your accountant or nearest Ithala
office, for guidance.

STEP SEVEN –

PERSONNEL PLAN

The people involved in the business must have the

necessary skills and experience if the business is to be
successful. To adequately assess personnel, you should:

17
 ● Detail the educational qualifications, previous work
experience and training courses attended by the
owner(s) (you might attach a brief CV of the owner(s));
● Indicate the number of staff to be employed;
● Indicate the job designations and functions within the
business;
● Detail personnel remuneration packages, incorporating
provisions for leave pay, annual bonus and the like;
● Indicate any plans for expanding in the short-term and
corresponding increases in the staff complement; and
● Indicate the owner(s) remuneration requirements,
considering their personal commitments.

STEP EIGHT –
CONCLUSION
Just as your introduction should be interesting, so your
conclusion should be positive and motivating.
It should comprise :
● A summary of why you believe your business plan will
succeed; and
● Why you believe finance should be approved.

Other sources of information

When compiling a business plan it will be
necessary to research much of what is required
for such a document. The following are some
of the resources available to you :
● Ithala offices : Client Liaison Advisors;
● Central Statistical Services;
● Council for Scientific and Industrial Research
(CSIR);
● National Productivity Institute (NPI);
● Local Councils;

18
● Department of Trade and Industry (DTI);
● Chamber of Commerce;
● Magazines;
● Libraries;
● Universities;
● Competitors;
● Own experiences;
● Local Business Service Centres;
● SMME Desk at the Department of Economic
Development and Tourism; and
● Durban Manufacturing Advisory Centre

THE WAY FORWARD

Should you require financial assistance, you are now in a

position to submit your business plan to a financial
institution, such as Ithala and other commercial banks, in
order to seek loan finance.

Remember that you have gone to great lengths to develop

an accurate and comprehensive business plan, and that
such a plan must be regularly evaluated. Ensure that you
measure your actual performance against forecasts set.

STEP NINE –
GENERAL
If you are applying to Ithala or other commercial banks, for
financial assistance, it is necessary to attach your
business plan to a completed application form. Ensure all the
necessary supporting documentation as listed on the last
page of such an application is also provided You may

19
 submit your application, business plan and supporting
documents to your nearest Ithala office, or branch of
commercial bank selected. In the case of an application to
Ithala, the application or enquiry should be directed to our
Client Liaison Advisor.

finance
Before launching a business it is necessary to establish
your financial requirements. Adequate start-up capital is
critical to any fledgling enterprise and failure to plan for
this is a major cause of small business failure. Before you
open for business, it is critical to plan how much cash you
will need. You should also ask yourself what you need
money for; how much you need; does the amount allow
for unexpected developments; how and when you will
repay the money; can you afford the cost of borrowing;
and what is the outlook for business in general and your
business in particular?

Initially, a financier is likely to ask three questions :

● How will you use the loan?

● How much do you need to borrow?

● How will you repay the loan?

By carefully planning your financial projections

(see business plan section) you will
successfully negotiate the situation of future
shortages of funds. Borrow carefully in order
not to over-extend yourself.

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 SOURCES OF FINANCE
There are a number of sources of finance available to the
small business entrepreneur. These may include:

● Formal Financial Intermediaries such as:

– Provincial Development Finance Corporation
– Commercial Banks
– International Financial Institutions

● Informal Financial Intermediaries such as:

– Khula Retail Financial Intermediaries
– Stockvels
– Non-Government Organisations (NGO's)

● Other
– Family and friends
– Trade credit. Remember, that if trade credit can be
arranged and if you do not over extend yourself,
this is regarded as a good form of financing as it is
normally interest-free: The supplier "builds" his
return into the price of the article anyway, so use
trade credit where possible.

It is important to shop around for finance in order to get

the best possible deal.

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 operating and managing
a business

PRESENTATION
The appearance of a business is important in terms of
projecting a professional image. The business premise
must be clean, displays tidy and high traffic flow flow areas
used effectively. Pricing of items must be clear and
competitive.

SECURITY
Fraud and theft are a common occurence in business today
and regular stock-taking is therefore an effective method of
controlling this problem. Without this control measure the
net profit of the business may be adversely affected,
resulting, possibly in business failure.

MARKET TRENDS AND OPPOSITION ACTIVITY

It is vitally important for a business to move with the times
in order to capture its potential market share. Being
pro-active in this regard will enhance business, whereas
neglect in this regard could result in the loss of turnover
and, ultimately, failure.
It is also important to remain aware of your opposition’s
activities in order to counter various products,
promotions, and the like.

MERCHANDISING
If the stock and sales are monitored correctly,
slow moving products may be discontinued,
and fast moving products promoted
simultaneously, in order to prevent loss of
profit by the good sellers replacing the slow
sellers, thus increasing turnover.

PURCHASING
In order to survive in a very competitive
market, one needs to shop around for the best
prices in order to retain profit margins or even
enhance them.

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 PROMOTING
The promotion of new lines, products and even old stock,
carried out in conjunction with suppliers is a vital part of
any business. If possible, take new products on
consignment so that they may be returned if they do not
sell.

SELLING ON CREDIT
Avoid buying for cash and selling to clients on credit. The
opposite, however, is obviously greatly beneficial, to the
entrepreneur. Attempt to obtain your goods over 90 days
and sell for cash.

CREDIT CONTROL
Strict credit control measures must be implemented to
ensure that outstanding debt is paid timeously.

CUSTOMER SATISFACTION
All these controls may be of no use if the customer leaves
your place of business dissatisfied. It is extremely
important to meet customer needs. Be friendly and polite
and ensure that your customers return regularly.

Remember that without customers you have no business.

the franchise
option
WHAT IS FRANCHISING
Franchising is simply a way of doing business whereby the
owner (franchisor) of a proven business system grants the
right by contract to an entrepreneur (franchisee) to

23
 establish a similar business which will be run according to
strict quality standards and trademarks. The franchisee
receives marketing support, detailed work manuals,
start-up training assistance, advice on equipment and raw
material selection and regular visits by the franchisor.

FORMS OF FRANCHISES
MANUFACTURER - RETAILER
A manufacturer takes the responsibility for production,
marketing and national advertising whilst the dealer
accepts responsibility for sales levels in his/her area. A
prime example of this is the giant motor car concern, Ford.
MANUFACTURER - WHOLESALER
A manufacturer grants a franchise to a
wholesaler who, in turn, sells to a retailer.
Example: Coca Cola which franchises the
syrup to wholesalers, who bottle the product
and then sell it to retailers.
VOLUNTARY CHAIN OR CO-OPERATIVES
Retailers set up franchise co-operatives for the benefit of
bulk buying and national advertising. Good examples of
this approach include Spar, Link and Plus Chemists.
SERVICE - TRADE MARK
This system is know as business format franchising. This
is the type of franchising with which most of us are
familiar. It includes Kentucky Fried Chicken, Steers, Supa
Quick, Wimpy and the like. It is known as business format,
because the franchisor provides the entire business format
including product, store lay-out, clear manuals and
standards, quality control and ongoing managerial support.

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 REQUIREMENTS FROM A
FRANCHISEE APPLICANT
Before a financial institution considers financing a
franchise, the prospective franchisee must have been
screened and accepted by the franchisor. This normally
involves the franchisee having to pay an up-front franchise
fee to the franchisor. Without this, most franchise
companies will not consider talking to a financier about
proposals, projections and costs.
A trading site must be identified and be accepted by the
franchisor (in terms of the geographical trading rights of
other franchisees).
A normal business viability study must be completed
taking into account the franchisees business acumen, the
viability of the business and security offered, with the crux
being the potential turnover. Gross profit and expenditure
details are normally available from the franchisor
according to industry norms and success or failure
ultimately depends on achieving the necessary minimum
turnovers. Industry norms greatly assist the financier in
completing projections. An own contribution of not less than
20% would normally be required from a franchisee applicant.

legal aspects
When starting a business, it is important to ensure that the
business does not transgress the law. One should register
yourself and or the business with the following institutions
● Inland Revenue, with regards to provisional tax;
● Inland Revenue, registering as a VAT Vendor (if the
turnover of the business is to exceed R150 000 per
annum);

25
 ● Workman’s Compensation Commissioner, if you
employ staff;
● Sampro, if you are to provide music within your
business premises;
● Department of Manpower : Unemployment Insurance
Fund, if you employ staff;
● Joint Services Board in respect of regional services and
establishment levies;

● Department of Trade and Industry with regards to

import/export requirements; and

● Any other councils/organisations within your type of

industry that by law, you have to register with.

It is also advisable that you study other legislations such as

the Basic Conditions of Employment Act and the
Employment Equity Act. As far as practicable, get a
professional legal opinion on these legal matters.

26
 Ithala regional
branch offices

(in each case the enquiry should be directed to our Client

Liaison Advisor) :

Durban Branch Office Ulundi Branch Office

(Game City, Umgeni Road)
P O Box 47662
GREYVILLE 4023
Tel. (031) 3091073
Fax (031) 3091086
Umlazi Branch Office
P O Box 54001
UMLAZI 4031
Tel. (031) 9071155
Fax (031) 9075113
Port Shepstone Branch Office
P O Box 1015
PORT SHEPSTONE4240
Tel. (0396) 823254
Fax (0396) 820703
Ngwelezana Branch office
P O Box 292
EMPANGENI 3880
Tel. (0351) 942301
Fax (0351) 942358
P O Box 87
ULUNDI 3838
Tel. (0358) 700361
Fax (0358) 700814
Madadeni Branch Office
P O Box 1281
NEWCASTLE 2940
Tel. (03431) 92078
Fax (03431) 91721
Ezakheni Branch Office
P O Box 780
LADYSMITH 3370
Tel. (0361) 341415
Fax (0361) 341896
Pietermaritzburg
Branch Office
P O Box 2573
PIETERMARITZBURG 3200
Tel. (0331) 458351
Fax (0331) 946468

Jozini Branch Office Alice Street Branch Office

Private Bag X005 127 Alice Street
JOZINI 3969 DURBAN 4000
Tel. (035) 5721223 Tel. & Fax (031) 3092529
Fax (035) 5721322

27
 projected income and
expenditue statement

DETAILS NOTES DEPARTMENT 1 DEPARTMENT 2 TOTAL

R R R
Income 1
Less cost of sales 2
Gross income
Stock turnover rate
Average stock

Less overheads

Staff salaries/wages 3
Telephone 4
Accounting fees 5
Elect/water 6
Insurance 7
Transport 8
Owner drawings 9
Stationery 10
Advertising 11
Rental 12
Security 13
Repairs and maintenance 14
Depreciation 15
Bank charges 16

Nett operating income before tax

And interest
Less Proposed loan interest 17
Less other interest 18

Nett income before tax

Less tax 19

Nett income after tax

28
 Department of
Economic Development
and Tourism
KwaZulu-Natal
DEVELOPMENT FINANCE CORPORATION LIMITED

Starting & Running your Own business

Paton Tupper Associates