Hello, on this page you will learn how to close your business/company in Malawi. We will also show you how you can use simple tactics on how to make sure you get the best out of your situation as the owner.
The decision to close a business is usually due to one of two reasons:
- You no longer want to run the business and have no one to pass it onto.
- The business is not making enough money to keep going.
Whatever your reasons, closing your business can take some time, depending on the size and complexity of your business. Here are some suggested steps to guide you through the process.
1. Make sure closing is the right decision
If you’re thinking of closing your business due to financial concerns, a change in personal circumstances or because you find it hard to comply with government regulations, consider getting help or advice to put your business back on track.
2. Set a closing date for your business
Setting a date to officially close your business from operations will help you to properly plan your business’ closure. The earlier you set a closing date, the earlier you can start letting suppliers, employees, customers and other parties know.
3. Take care of your employees
If your business has employees, you must notify them and officially finalise their employment before your business closes.
4. Notify suppliers and customers
If your business uses suppliers, you’ll need to:
- let them know that your business is closing
- tell them the date from which you’ll no longer need their services
- pay them any outstanding amounts.
It’s also a good idea to let your customers know when you’re closing the business. This will minimise their inconvenience, and may also maximise your profits right up until the date you close. How you let your customers know will depend on the type and size of your business, but can involve:
- posting a notice on your shop front
- posting a notice on your business website
- personally advising customers
- advising customers through your business’ social media channels
- holding a closing down sale, with the added benefit of selling off your stock
- sending out an email or letter campaign.
5. End lease agreements
If your business has a lease, you’ll need to end your lease agreement when your business closes. Depending on the conditions of your lease, you may still need to pay rent and other costs up until the end of the lease term.
You may be able to avoid paying these costs by transferring your lease to a new tenant. However, keep in mind that certain risks and conditions may apply toa transfer, depending on the lease agreement.
If you’re unsure of the conditions in your lease agreements, you should contact your lawyer for professional advice.
6. Sell business assets and pay outstanding bills
Even though you’re not selling the business, you’ll still need to sell or manage your business assets when you close your business. Business assets can include:
- all outstanding stock
- tools, equipment and machinery
- property and premises, including land or buildings
- business vehicles
- furniture, fixtures and fittings
- domain names
- intellectual property such as patents or trademarks
- licenses and permits.
You’ll also need to pay all outstanding bills when your business closes.
7. Deal with tax and legal matters
When closing down your business, there are a number of tax and legal matters you may need to deal with.
8. Look after yourself
Closing your business can be an emotional time. After all, you’ve probably put countless hours, money and energy into running your business. We can help you get through this process by setting up an appointment with our business friendly counseling services for free.