10 Steps to Begin a Business
Establishing a business is something that begins with the desire and passion to create and work for yourself. Of course, creating a business is just the beginning, because the hardest part comes afterward. For this reason, this manual comes in hand to show you that creating and managing your business can bring a radical change to your future life. Success has no ready-made formulas, but those with knowledge have much more chances to achieve it and gain a more important role in society. The current market situation is provided through macroeconomic indicators as well as by other public information bodies. The market in Tirana is presented as a highly dynamic market with great opportunities in creating new businesses. Of course, these opportunities are related to different sectors such as services, food, tourism, transport, information technology and telecommunications, education, information, etc.
The Tirana-Durres Market is the main artery of Albanian business today and the development of new businesses in these metropolises is on the rise. This market accounts for 1/3 of the Albanian population and the largest share of average monthly income per capita. This purchasing power is a very important advantage to deciding where to start your business.
Step I. How to Find and Appreciate a Business Idea through Business Models?
The current market situation to start a new business.
The current market situation is provided through macroeconomic indicators published by INSTAT, but also by other public information organizations. Sustainable economic growth, but especially market dynamics in the high quality of products and services, creates opportunities for the development of new businesses that bring higher standards, competing with other existing traders.
In technological terms.
Today’s technology has advanced enormously both in the production of products / services for customers, as well as in the form of communication and negotiation with customers. Today, customers use the handset, email, website, daily press or TV to get acquainted with the products and services of various, big and small companies.
Step II. How to create a business plan?
To create an idea as a business plan is prepared you can get models that are usually provided by business development agencies, lending institutions, local government structures, and so on.
A Basic Model is the following:
- Cover and executive summary
The cover includes business name and owners as well as contacts. The executive summary clearly defines the vision and business structure. At this point, the products or services that are offered, market opportunities and business intentions are identified for a certain period.
- Business Description
This point provides general business information and competitive advantages in the market. The business description includes the name of the business type and the way it is structured. Conventional advantage refers to strengths of product or service compared to the competition.
- Market analysis
At this point the product or service is accurately defined, customers and their characteristics are identified, market potential is measured and the best tools are chosen to carry out the process.
- Management plan
This section deals with the business management structure and describes the roles and responsibilities of the staff together with a description of the day-to-day functioning of the business. The operational part of the business describes how products and services are produced and distributed.
- marketing plan
This section gives details of the price, product or service delivery strategy, and promotional tools to be used to advertise.
- Financial plan
The financial plan describes the amount of money needed to start the business, how the business will be funded and the expected outcomes. These include:
- Finishing mirrors
- Income statement
- Payment Analysis
- The projected cash flow
- Capital Equipments
Once the business plan has been finalized and the information you submitted has been consulted by an expert (entrepreneur or bank officer) in advance. The business plan is a document that requires refresh and is used as a management tool for the entire duration of the business.
Step III. How to fund a business plan?
Providing funds to finance your business plan is one of the major problems to be solved. The sources of funding are:
- Personal savings
Personal savings are one of the most commonly used sources for starting a business. A personal investment in the business shows the full commitment of the individual to be successful.
- Selecting a business partner
It is possible to negotiate an agreement or partnership with other people or businesses that can provide financial support in cash, equity, or credit.
- Non-formal funding
Family, friends and organizations are good examples of informal sources of funding. Non-Profit Organizations can assist in the preparation of financial statements and provide services, legal assistance and can provide their networks.
- Commercial Loans
Trade credits can be used to put the business plan into effect. This includes suppliers who send goods or services before they receive the payment.
- Loans and microcredit for small businesses
The opportunity to benefit small business loans lies in the “5 K” of credit granting (character, cash, collateral, capital and terms). Those who start a business have less chance of borrowing than consolidated businesses as they pose greater risk. On the other hand, there are microcredit banks and institutions that lend exclusively to newly created businesses, benefiting from guarantee systems that promote small business development.
- “Crimson Finance Fund”
AADF in partnership with Norfund, Crimson Capital Corp and the Municipality of Tirana, founded Crimson Finance Fund (CFF) Albania, a non-banking financial institution that provides development finance for small and medium businesses. CFF Albania is designed to improve access to finance for small and medium enterprises, entrepreneurs, innovators, women-owned businesses and farmers in Albania, with a view to promoting business and job creation. Unlike bank institutions lending subject to collateral available, this financial institution assumes other instruments and instruments such as purchase orders or the potential that brings an idea to the domestic market.
Step IV. What structure will I choose for my business?
The business venture chosen for your venture may affect initial and operational expenses. When choosing a structure for your enterprise you should consider:
- The number of people participating in business,
- The role of each of the partners in the business and the ability to withdraw from entrepreneurship,
- Financial Resources Needed.
Regardless of the structure you raise, you should be concerned if you need a license to run your business and check what taxes you have to pay according to the structure you have selected.
A good idea is to seek professional advice to address some of these issues. Business advice is provided by the local chambers of commerce and business development agencies. Accountants, lawyers, and bankers can help you to choose the best form for your underwriting. The most common forms of enterprises are:
- Ownership of the person
In this form the individual owns his business entirely. The main advantage is that all income belongs to the owner while the disadvantage is that the owner is entirely responsible for all debts and obligations to third parties.
Two or more partners share ownership of the business. The main advantage is that the expenses and incomes are divided on the basis of the partnership agreement, while the disadvantage of the partnership is that each partner is personally responsible for all debts and obligations of the business.
- Collective Societies
Collective societies carry out a commercial activity under a common name and the liability of partners before the creditors is unlimited. Contribution to partners may be in cash or in kind (movable/immovable property, rights, labor and services). The partners’ contributions are equal.
- Command Companies (SHKM)
A partnership is a society in which the liability of at least one of the partners is limited to the value of its contribution, while the liability of the other partners is not limited. Ortaku, whose responsibility is limited to the value of his contribution, is called limited partner. Ortaku, whose responsibility is not limited to the value of his contribution, is called an unlimited partner. The unlimited partner has the status of partner of the collective society.
- Limited Liability Companies
A limited liability company is a company established by natural or legal persons who are not responsible for the obligations of the company and personally cover the losses of the company until the unpaid part of the signed contributions. Partner contributions are the registered capital of a limited liability company. Each partner enjoys his quota in society, in proportion to his contribution to capital. The registered capital of the company is divided among the partners in the quotas, according to this report.
- Joint Stock Companies
A joint stock company is a company whose equity is divided into shares signed by the founders. Founders are natural or legal persons who are not personally liable for the company’s liabilities that cover its losses only with the unpaid value of the subscribed shares. Joint Stock Companies may be private or public offering companies.
Step V. What will be the staff and how will you select it?
It’s not enough just to choose the employee. A deeper thought is required. Trusted advisors are needed, including lawyers, accountants, insurance agents. A thoughtful choice might require hiring a virtual assistant that would help you prepare business launch documentation. If you hire staff who will perform specific jobs, such as technologists, sales agents, etc., they should have the skills to meet your job requirements and also need to be trained by you about job processes to achieve the goals you have set in your business plan.
Step VI. How do I choose my business setting?
Selecting a location is one of the most important decisions you need to get for your business. Includes a detailed analysis and assessment of the demography of the area, the supply chain, the level of taxes and tariffs and the incentives of the area. These are the steps that will be taken into consideration during business location search and planning:
- Determining Needs
Many businesses choose their location based on the level of exposure to customers, but there are other factors that need to be considered:
- Vision of the Company
- Labor market
- Forecasts for business expansion
- Zoning and Regulations
- Finance Evaluation
Apart from considering whether the costs for meeting the business opening needs are affordable, you should also consider;
- Hidden costs (renovations, reconstructions, water supply, power, sewerage, etc.);
- Taxes (tax levels by zones);
- Local economic incentives;
- Business friendly area
A detailed analysis of the legal framework and legal and sub legal acts related to business is very important. Also, studying advantages from co-operation with other businesses, or specialists (advisors), organizations that assist opening up businesses or structures of local governments are factors that influence your business location selection.
Step VII. How to prepare documentation for opening my business?
The applicant can obtain information about the documents needed to register his business and the application form by downloading it online on the official website of the National Business Center www.qkr.gov.al or by submitting to the KBC counters to withdraw the form.
Each applicant must be provided for the business form he wants to register before applying for initial registration. More detailed information on these legal forms can be found in Law no. 7638, dated 19.11.1992 “On Commercial Companies”. This and other similar laws can be found on this official website of the ICC.
Under the legal framework in force, subjects must apply for initial registration within a 15-day deadline (unless otherwise provided by special laws). The term is calculated as follows:
- For natural persons the application for registration is carried out by the person who is registered or by any person authorized by him / her.
- For simple registration companies, registration is carried out by all members or by any person authorized by them.
- The application for registration companies is performed by all partners of a collective company or by all “unlimited” partners of a limited company, by all administrators of a limited liability company (nominated in a charter, notarized document of the company), by all members of the oversight directorate of an anonymous company (nominated in a charter company, notarized company), or any person authorized by the abovementioned persons through a notarized authorization document.
Step VIII. How do I register my business?
- Fill in the application form
To start registration, an applicant must complete the application form. Application forms can be obtained and completed in two ways:
a) at any UCC’s desk;
b) can be downloaded and completed on the official website of the ICC:
All application forms are provided with instructions for completing them.
- Submission of application for registration to KBC
Once the application form is completed, the applicant (or the authorized representative for registration) submits the application form in person to each KBC service desk, along with other appropriate supporting documents.
The applicant or authorized person shall be identified at the UCC’s desk through an original identification document as well as (for the authorized representative) through a notarized authorization, for the applicant’s representation for the purpose of registration.
The desk clerk verifies that the application and accompanying documents are complete and acceptable by the KBC. If the application is incomplete or incorrect, the desk clerk will assist filling out the form together with the applicant and will print (print) the completed form.
Once all of the aforementioned steps have been completed, the UCC’s desk clerk provides the applicant with a confirmation of the application made, which is issued by the ICC’s electronic system and has a unique number of folders. This confirmation is signed by both the applicant and the desk clerk. The Applicant may use this unique folder number to track the status of the registration process at any time through the official web site of the KBC, by clicking Check the Application Status.
- List of accompanying documents
In addition to the completed application form, the applicant must also submit the relevant accompanying documentation as follows:
- Original Identification Document (Biometric Passport, Electronic Identity Card), which the Desk Officer will verify, copy and scan and eventually return the applicant (s). The applicant should not leave the service desk without receiving his identification document.
- Other accompanying documents. The list of documents required for initial registration is specific to different legal business forms. Once the type of business to be registered is identified, the applicant can find the list of accompanying documents attached to the specific application form for registration, which can be obtained either at the KBC’s desk or on its official website.
The applying person performs the payment at the service desk where he applies. Fees are published on the official website of the ICC. Payment is made at the KBC desk when requested by the desk clerk and after a unique number from the electronic file system is assigned. Payment is made prior to the final signing of the application form by the employee and the applicant. The fees are as follows:
At the end of the following day from the date of application to the KBC, the application for registration will be accepted or will be rejected or suspended if the ICRC finds that the information provided is incomplete or not in accordance with legal requirements.
In case of receipt of registration. Upon issuance of the application confirmation, the application and accompanying documents are reviewed for decision by an authorized CBC officer (registrar). If after the verifications the authorized officer (registrar) finds that the application is in compliance with the requirements of the law, within a maximum of 1 (one) day from the filing of the application he approves:
Upon issuance of the application confirmation, the application and accompanying documents are reviewed for decision by an authorized CBC officer (registrar). If after the verifications the authorized officer (registrar) finds that the application is in compliance with the requirements of the law, within a maximum of 1 (one) day from the filing of the application he approves:
- Conduct registration
- Issuance of Unique Identification Number (NUIS), also known as NIPT;
- Proof of registration and issuance of registration certificates (in case the business is registered). These certificates (one for each country where the business carries out an activity) can be obtained from the applicant (or authorized person) at any KBC service desk;
- Performing an electronic publication of the registration in the Official Announcement Bulletin of the ICC Registration, which can be seen on the official website of the ICC, the day after the enactment of the registration.
Completion of registration and issuance of registration certificate are the evidence of the applicant for business registration, business tax registration (taxation tax), registration of social insurance, registration of health insurance and registration with labor inspectorate authorities.
If following verification of the application form and the accompanying documents, the authorized registrar finds that the application is not in accordance with the requirements of the law, it shall suspend the registration within the maximum time limit of 1 (one) day of submission of the application.
The NCB notifies the applicant of the reasons for the suspension within 1 (one) day of receipt of the application for registration through a document issued by the computerized system at each KBC service desk. The applicant has a 15-day deadline for completing or correcting the elements that prevent the registration. The applicant may check the online application status using the unique number of the file he has received after submitting the application form. Suspension reasons are not published on the ICC’s web site but can be electronically emailed to applicants who have used the “Apply On-Line” function or who have provided an email address in the application form. Alternatively, the applicant must appear at the counter for obtaining the aforementioned document, which gives reasons for the suspension of registration.
The applicant may at any time within 21 days request at the counter the completion or correction of the elements that prevent the registration, by filling in the relevant form and by submitting the necessary accompanying documents.
c) If after the verifications the authorized officer (registrar) finds that the data required to be registered are different from the data recorded according to the provisions of the law, registration shall be refused and the applicant shall be informed in writing on the reason for refusal. Authorized Registrar refuses registration if the applicant has not completed or corrected the elements preventing the registration within 15 days. The authorized employee also refuses registration even when the application for filling or correcting the elements preventing the registration does not meet all requirements set out in the law.
d . If within one (1) day from the filing of the application for registration, the CBC has not notified the suspension of registration or its refusal, the application for registration is presumed to be accepted. In this case, the ICC’s computerized system automatically authorizes the registration.
Step IX. How do I register in central and local tax structures?
Following the adoption of the new registration, the NCB simultaneously notifies the General Taxation Directorate and the relevant municipal fiscal authority for the registration of a new entity together with its NIPT for fiscal effects and transmits the registration data of applicants to these authorities.
For each new entity, registered in the Trade Register, the KBC also notifies the Labor Inspectorate, the Social Security and Health Insurance Inspectorate. The KBC makes the above notifications electronically, within the working day of the registration.
a) Prior to the beginning of the economic activity and for the effect of the payment of social and health insurance contributions, it is initially registered at the National Business Center (NCC). Afterwards, a copy of the taxpayer’s identification certificate is presented to the Social Insurance Agency. The Social Insurance Agency, based on this document, realizes your registration with the social security bodies.
b) The self-employed, two days after the registration at the GCK, must submit to the tax authority the list of unpaid family workers with whom he / she works and co-habits, form E-SIG 027 / a “Employee Statement for the first time as well as those who have been dismissed. ”
Compulsory social and health insurance contributions can be paid to subsidiaries of second tier banks or Albanian Post.
After the business registration at the KBC, within 10 days of receiving NIPT, you must submit to the General Directorate of Local Taxes and Fees in order to register for fiscal effects with the following documentation:
1. Registration Records received by the ICC
2. A copy of the Identity Identification Number (NIPT) issued by the KBC
3. A photocopy of the Identification Document
4. Ownership Documents
4.1 Photocopy of the lease contract if you are a renter, attached to the planimetry of the facility and its plan-placement
4.2 Copy of ownership document if you are the owner of the facility where you are performing the activity, together with the relevant plan
4.3. Photocopy Purchase Agreement.
4.4. Photocopy Act-Venture (Certificate of Receipt by Signature)
4.5. Photocopy Self-declaration form for legalization.
5. Other business documents for the so-called Large Business Companies
5.1 Establishment of the Society
5.2 Statute of the Society
The unique identification number of the subject is valid for the identification of subjects, for purposes of registration in the register, for the purpose of registration as a taxable person at:
1. central and local fiscal authorities,
2. for the social and health insurance scheme,
3. for the labor inspection authorities,
4. as well as for any other statistical or identifying purpose.
The Domestic Code is an ID number for taxpayers at DPTTV (for internal purposes of this Directorate).
1. Waste Disposal / Removal Fee / Category II
2. Tariffs for the occupation of public spaces
3. License for Licensing for Trading of Fuel and Fuel
4. Veterinary service fee
5. Administrative service fee of the Municipality of Tirana
Step X. How to Create a Sustainable Business Development?
For business enterprises, sustainable development means the adoption of business strategies
and activities that meet the needs of the enterprise as well as the protection, conservation and enhancement of human and natural resources that will be needed in the future.
Seven steps are needed to manage a sustainable development of the enterprise.
- Conduct an analysis of stakeholders
- Establishing Sustainable Principles and Policy Development Goals
- Draft and execute an implementation plan (implementation)
- Creating and developing a business support culture
- Development of performance measures and standards
- Prepare reports
- Improve internal monitoring processes