6 Business Mistakes That Could Wreck Everything (And How to Avoid Them)

Registering a company in Kenya is easy. Running one properly? That’s where most people go wrong and when things go wrong, it’s rarely about effort, it’s about structure.

Here are 6 costly business mistakes we’ve seen clients make, mistakes that have lost them tenders, contracts, money and peace of mind. If you’re a founder, director or SME operator, this is for you.

Mistake 1: Running the business from your personal M-Pesa or bank account

You receive money in your personal account, spend from there and hope it balances out. It won’t. When you mix personal and business transactions, there’s no record, no clarity, no structure. So when KRA audits you, a client sues, or a dispute arises, you can’t prove anything and here’s the kicker, legally, there’s no difference between you and your business. You become personally liable.

Fix it - Open a business account. Run all income and expenses through it. Protect yourself and your books

Mistake 2: Commingling funds no dedicated business account

Even if you’re careful, using multiple personal lines to manage business cash flow makes you look disorganized, unprepared and unprofessional. If you’re ever taken to court or investigated by KRA, you’ll have no way to clearly separate personal transactions from company business.

Fix it - Keep all business-related income and expenses inside the company account. Treat your business like it matters.

Mistake 3: Signing contracts in your own name

If you’re a director and you personally sign contracts, without reference to the company, you’re personally liable.

That means when things go wrong, you’re the one sued. Not the company. You opened the door.

Fix it - Always sign as the company and ensure contracts reflect that clearly. Include your title (e.g. Director) and ensure the company seal or name is used properly.

Mistake 4: No corporate records or documentation

No board resolutions. No meeting minutes. No record of company decisions. Then a dispute arises and you’re in court. You say, “We agreed verbally.” The judge asks, “Where is it written?” You lose.

Fix it - Maintain proper minutes, resolutions and governance records. Not just for court, for credibility and internal discipline.

Mistake 5: No insurance

Accidents happen. A fire wipes your inventory. A boda boda rider you hired causes an accident. A client sues for breach. If you’re not insured, the entire business can collapse.

Fix it -  Take out a basic insurance policy. It could save your company.

Mistake 6: Forgetting to file annual returns

This one seems minor until it kills your shot at a tender. When you apply, BRS flags you as non-compliant. You’re automatically disqualified. Not because of your performance. Just a form you forgot to file.

Fix it - File your returns annually. Mark the date. Do it even if your business was dormant.

This video breaks down the 6 silent mistakes quietly sabotaging most businesses and how to avoid them before it’s too late. Watch below.

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