Starting a Business
Starting a new business in most of the cases is a once-in-a-lifetime experience. However, this experience is exciting in the first phase. It can quickly transform into a nightmare during the building phase for many reasons like :
- Difficulty to convince the market and the customers,
- The under-estimation of the amount of work
- Lack of long-term vision
- Difficulty to access capital.
Thus, in the new business, it is said that a 3 years’ milestone is a good indicator of sustainability.
First of all, new businesses face major challenges such as-
- Access to capital
- Registration of the startup,
- Taxation rules
- Availability of right talents that could match business requirements
- Effective market penetration.
However, the regulatory challenges in most of the cases are under-estimated. It is often not clear to the owners where to start and how to comply with the regulatory filings, in most of the cases.
A recent study from Babson College on 10k small business (by extension new businesses are small businesses) shows that 60% of survey respondents have some level of difficulty to understand and manage the government regulations as well as the regional and local laws that affect their businesses.
We can identify multiple reasons for the difficulties: How do small business owners learn about regulations? The time it takes to comply with all the regulation burden and the lack of understanding of the impact of non-compliance with regulations, on the business itself.
Third party advisors
Some small business owners mainly rely on a third party professional advisors like attorney or accountant to advise them. It involves a cost which is substantial in most of the cases. Others rely on trade associations, the internet, local Chambers of Commerce and Small Business Association (SBA).
Time is the most important business resource in their new business. Everything should happen quickly and efficiently to ensure quick and sustained growth. We consider regulations a part of a long drawn bureaucratic process. It is an impediment to the growth of the business. On an average, it is said that entrepreneurs spend 4 Hour/week to comply with all the responsibilities.Thus, it means approximately 200 hours per year!
The perception of regulations as a threat to the businesses is based on the fact that owners mainly consider the initial cost of the compliance and the time spend on it. However, we overlook that regulatory compliance – when clearly implemented, well organized and well done, can become a competitive advantage, a marketing argument and a way to build your reputation.
Non-compliance can lead to financial penalties, punitive damages, severe prosecutions and loss of reputation and in the case of a small business, as they are fragile institutions, the closure of business itself.
To conclude, the regulatory filing process for business is complex with taxation and legal ramifications. People know what they can lose but don’t know what they can benefit from compliance.
V-Comply is a SaaS tool which does the heavy lifting of compliance management for you. With features like Cal Repository, Compliance Library, Assign, and Remind functionality, Cloud storage integration, Performance Tracking, Risk Classification and many other powerful productivity features – it makes the process of compliance management Simplified.Add to favorites