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  • How to Start a Business

Benefits of a Shelf Company

2021 was a trying year for many entrepreneurs, where many business owners were on the lookout for more business opportunities. As we enter 2022, many tender opportunities become available to entrepreneurs and aspiring entrepreneurs. But what sets one business ahead of the other in a tender bid? In this article we will be discussing the benefits of a Shelf Company.

What is a Shelf Company?

A shelf company is a PTY entity that has been pre-registered, with a generic name – usually the company registration number and is available for purchase by another businessman or woman. These companies are dormant entities that are maturing in age. The company itself has never actively traded or commenced any sort of business and is able to trade from the get-go. It is legal in South Africa to purchase a shelf company and by acquiring a shelf company, you obtain all legal rights to the company, its registration number, and the name.

What is the difference between a Shelf Company and a new PTY?

The two are one in the same, for all that the shelf company has just been registered in advance for resale. Even though registering a new company is a relatively quick process, there are documents that will need to be processed before obtaining the company registration number. A shelf company is instant. You get the registration number as soon as you purchase it. So if you’re in a hurry to get a company registration number, then a shelf company would be your best bet. 

Interested in a Shelf Company?

Looking for an old company registration number? View our full range of Shelf Companies available for you today!
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What are the benefits of a Shelf Company?

Advantages:

  • As an official registered PTY entity, trading on the company may commence instantly as the buyer has obtained the shelf company’s registration number upon purchase. 
  • You override the registration process as the company is already legally registered.
  • You are instantly given a company registration number to use.
  • The Company will be in good standing up until the day of which the new owners paid for the company, the new owner will need not worry about the submissions due to SARS and CIPC before the company was sold.

Disadvantages:

  • The company will be registered with a generic name that will need to be amended by CIPC should the new owner choose to do so.
  • Other amendments that will need to take place on the company would be the director details, address change, etc.
  • The originally incorporators name will always reflect on the MOI (Memorandum of Incorporation)

How does a Shelf Company benefit your chances at a tender opportunity?

Because the entity has been pre-registered, the registration number will read the year in which the company was registered first. Example: A company registered in 2019 with have a registration number showing as 2019/******/07. This informs the official or prospective client that your company has been established since 2019. Where many tenders require a matured company, a shelf company would be the best option in ensuring your chances of winning the tender bid. This allows the company to be eligible for a tender bid ASAP.

How do I purchase a Shelf Company?

Shelf companies are available for purchase from any individual or cooperation who have already registered companies in South Africa. Company Partners being one that has assisted many South African entrepreneurs in obtaining their very own shelf company. Buying of a shelf company is a quick and a less stressful process which allows for quick start of trade.

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