Paper type: Essay Pages: 11 (2534 words)
As an entrepreneur, the new hospitality business selected will be a cafe that sells freshly baked pies named Pew Pew Pie Cafe Pew Pew Pie state of the art for Pies includes the Classic Pies and Pot Pies with variety of choice. With a dish that is baked with the best pastry dough and fillings of sweet and savory of the finest ingredient, Pew Pew Pie will surely manage to be a center of the food attraction in Malaysia as Pew Pew Pie aims to be the first and best tasting pie in Malaysia.
With the large seating area for customers to enjoy and relax, a 960sq ft is needed to cover a maximum of 100 customers including a free assessable WiFi for customer to do their work while waiting or relaxing in Pew Pew Pie cafe.
The Pew Pew Pie will be operating in Jalan Bukit Bintang with a high density of working adults around as a target market for Pew Pew Pie cafe.
With the high density of working adults and other patrons patronize the cafe, this ensures that Pew Pew Pie cafe will be able to reach a gross profit of fifty percent in the first two years of sales. Since there is no cafe or restaurant specialize in making pies, Pew Pew Pie will surely dominate this pie selling market and soon to expand more branches especially to the places where there is a lot of high density of people and food lovers.
In order to start up the business, legal documents, licenses, approvals and insurances is required. This includes the Registration of New Business, Malaysia’s Income Tax Department regarding SOSCO, Employee Provident Fund (EPF) and Inland Revenue Board Malaysia (IRBM), Premise license and signboard licenses, Music License, Department of Occupational Safety and Health, Fire Safety Department, Sanity and Sewage Department and lastly Application for Insurance.
2.0.1 Registration of New Business
Under the Business Registration Act 1956, Type of business register is Private Limited Company. With the procedure of using a trade name as PewPew Sdn Bhd as the company, an approval must be obtain from the Companies Commission of Malaysia (CCM).
A business owner must complete the business registration Form 13A (Form A) from the Companies Commission of Malaysia (CCM) with the information includes business name, commencement date of business, principal place of business, information of owners and type of business carried out.
Relevant documents are also required to attach with the Form A such as a photocopy of owners identity card, permit and license of operating with registration fee of RM60 as for sole proprietorship using trade name. The business name will be reserved for three months if the name is approved by the Companies Commission of Malaysia (CCM).
Then obtain the certificate of incorporation, memorandum and article of association form 6 done by the company’s secretary, original form 13A, statutory declaration of compliance and a copy of the letter of approval (address and location of the registered office) with Companies Commission of Malaysia (CCM).
The reason why PewPew Pie cafe register for private limited company (Sdn Bhd or sendirian berhad) it’s because when people get food poisoning and decided to sue you (worst case scenario) due limited liability of a limited company as it safeguard the owners personal asset.
Furthermore many people feel safer when dealing with a limited company rather than a sole proprietor due to the company is legally established. As employees may feel safer working for a company than a sole proprietor.
In terms of tax savings, limited company benefits by the lower rates of income tax on dividends enable owners to earn extra profits without paying additional income tax. However the downside of using a private limited company are reports requirements regarding annual returns and accounts, administration costs for filing returns and accounts and lastly privacy is not available due to the company’s details is available publicly from the companies house.
2.0.2 Malaysia’s Income Tax Department
An business owner must then register with Malaysia’s Income Tax Department and require documents such as a Copy of Memorandum and Articles of Association, two copies of Form 9 – Certificate Of Registration from CCM (SSM) and two copies of Form 49 – Name and the address of the directors. All of these documents must be certified by the company secretary.
After the registration the owner require to submit a CP204 form to the Information Processing Department within the 3 months from the date of commencement of the business as the installments must be paid beginning from the 6th month of the basis period from the commencement of the operation.
After the employee tax reference number has been registered, the employer is required to determine Monthly Tax Deduction calculation is accordance with Income Tax (Deduction From Remuneration) Rules 1994 (Monthly Tax Deduction Rules) according to Explanatory Notes gazette by Inland Revenue Board Malaysia (IRBM).
For the Pew Pew Pie employees, 10 staff are required to operate the cafe. This staff requires being register under the employees’ provident fund (EPF), social security organization (SOCSO) and Inland Revenue Board Malaysia (IRBM).
These are the benefits given to employees to provide them a social insurance and retirement benefits. Employees’ Provident Fund (EPF) is to provide retirement benefits for members through an efficient and reliable manner while Social Security Organization (SOCSO) is a social insurance scheme provided by the Government of Malaysia to protect employees and their families in the event of accidents such as disability, death and chronic diseases.
To register EPF, an employee must register their employees with the EPF within 7 days of employment under law. As per section 41(2) of the EPF Act 1991, an employer should register the company with the EPF by submitting the KWSP (Kumpulan Wang Simpanan Pekerja) 1 Form and also complete Form EPF 3 with a photocopy of Identity Card, photocopy of Birth Certificate if do not have Identity Card and a photocopy of Passport or Work Permit. Once this are done, the members registration will be approved within a day for the date of submission. Every month, Pew Pew Cafe must submit the payment to KWSP within 15 day of the following month.
While for SOCSO, all employees earning less than RM3, 000 per month must register and contribute to SOCSO regardless of their employee status on full time or part time. Those who are not eligible for SOCSO are government servants, foreign employers, self-employed persons, sole proprietors and partnership, domestic servants or spouse.
To register SOCSO, employee must register within 30days from the date the worker is employ. The following Form that is need to be filled in are Form 1 (Employer’s Registration Form) submitted with two copies of Private Limited Companies of Form 9and Form 49 and Form 2 (Employee’s Registration Form) whereby the employees have to fill in Form 1 and Form 2 to get the employers code number for SOCSO.
meanwhile for the Inland Revenue Board, the document need to submit with the application form of income tax are a copy of identification card or passport of the applicants or partners, Form D on Certificate of Registration from CCM, Form A regarding Business Information from Companies Commissions of Malaysia (CCM), a letter from Bar council, form 12 under Medical ACT 1971, and appointment letter as a tax agent if the registration is done by a tax agent.
2.0.3 Premise license and signboard licenses
Premise license and signboard licenses must be apply by the respective state authorities. An applicant for the license must bring documents such as photocopy of the applicant identify card, a passport sized photograph, a copy of Memorandum and Articles of Association and forms 9,24 and 49, copy of rental agreement or sale and purchase agreement of the premise, copy of certificate of fitness of company’s business premise, copy of fire department’s support letter, copy of location plan of company’s business premise, photograph of business premise and location of the company’s signboard, sample of signboard indicating its design and colors from Dewan Bandaraya Kuala Lumpur. Premises must also set up to the standards of the health ministry and safety ministry.
This is needed to run a business legally in Malaysia as to know the business entity and type of business that the premise is running for.
2.0.4 Music License
Music License is also an important license to apply since Pew Pew Pie cafe is using commercial music for entertainment purpose. According to the tariffs from 1st April 2012 to 31st march 2013, the music license for the first 50 seats will be RM964.87 and Next 50 seats will be at RM804.50 as per RM16.09 per seat. So total music license that Pew Pew Pie will be paying for it will be at the cost of RM1769.37 annually for the 100 seats. This license is required as to avoid for copyright infringement as to prevent others from using composer or authors’ musical work without his or her consent.
2.0.5 Department of Occupational Safety and Health
Guidelines regarding staff training, Kitchen, environment and welfare, and lastly public/government, financial and professional service is a set of rules that need to be follow so that during inspection, chances of the cafe’s approval is rejected.
Furthermore Clinical services such as the Typhoid Immunization injection for food operators is a must for the employers and employees as they are working in the cafe on serving the food. With the fee of RM21.00 and a passport size photograph. After getting the vaccination shot, cards will be issued to the employees and employers which will be valid for a period of 3 months from the date of injection. This service is available at Level 1, Jabatan Kesihatan & Alam Sekitar, DBKL, KM4, Jalan Cheras, Kuala Lumpur.
2.0.6 Fire Safety Department
Numerous forms such as inspection architectural plan of the cafe layout, inspection of fire extinguisher and alarm is required for the cafe just in case if there is fire hazard or any other risk factors. The form that required for fire safety department is Form 1 that tells applying form for fireman, form 3 as renewal form and Inspection APA form that explains inspection and confirmation of fire extinguisher form.
2.0.7 Sanity and Sewage Department
SYABAS, the sanity and sewage department who in charge of handling the water distribution service in the state of Selangor and Kuala Lumpur and sewage for the cafe. a consumer details form is needed to fill up and submit to them regarding water demand schedule, pipes, fire flows design, pumping system and pipe and node details. The following document of SYA/F1A/A or SYA/F1A/B or SYA/F1A/C is needed to be fill in to announced that the premise have been used as a cafe to operate on the premises with a photocopy of applicants identity card, address, site plan , and water supply system that has been submitted and approved by SYABAS
2.0.8 Electrical Registration
Tenaga Nasional Berhad, Malaysia who provides electricity to the cafe as to obtain the approval of electricity usage. For commercial usage for Pew Pew Pie, tariff category would be tariff C1 whereby medium voltage general commercial tariff that uses the minimum monthly charge of RM600 per month. However registration is required and be submitted that are Form A (First Schedule in Electricity Regulation 1994), Form G (Supervision and Completion Certificate) and Form H (Test Certificate).
2.0.9 Application for Insurance
Insurance is must for the protection of any business including cafe and restaurants. Furthermore, this cafe business needs multiple types of insurance due to the numbers of potentially hazardous and unexpected situations that can befall or derail the business.
The insurance company Pew Pew Pie will choose is AIA Malaysia as their commercial packages plan provides coverage up to four sections that are Section I on fire insurance, section II on burglary and robbery insurance, Section III on accidental damage to fixed glass and signboards and lastly section IV on public liability insurance.
According to AIA insurance policy, Section I where is Fire Insurance policy provides protection against loss of or damage to property insured caused by Fire, Lightning including the following extended perils. As well as Riot, Strike, Malicious Damage, Explosion, Bursting or overflowing of water tanks, apparatus and pipes. With the terms and condition of excess covers the first RM1,000.00 of each and every loss and the sum insured is less than RM50,000, the excess may be reduced to 1% of sum insured but subject to a minimum of RM100.00.
Section II on Burglary and Robbery Insurance on loss of or damage to Property Insured under Section I on the protection against loss of stock-in-trade, furniture, fixture and equipment within the insured premises by Robbery or Burglary or any such attempt. The policy also covers damage to building, renovation and property insured under Section I. Section II also covers the loss of money and securities where explains on the protection against loss of money and securities by robbery or any such attempt thereat within the premises including damage to the premises.
Section III on Accidental Damage to Fixed Glass and Signboards where to provides coverage to fixed glass and signboards against accidental damage. Section IV on Public Liability Insurance as providing protection against legal liability for accidental bodily injury or illness to third party or accidental loss of or damage to third party property arising out of the operation of your business including but not limited to claim for death or illness due or alleged to be due to food or drink supplied by you at your premises.
However, the duration of this commercial plan covers on yearly basis and require renewing every year. So Pew Pew pie decided to buy a section I to section IV a standard plan which cost around RM741.85 per year.
If certain documents, licenses, approvals or insurances fail to get the attention, there will be high risk that the business will be rejected by the authorities. So in short, starting up a new business without any experience would be difficult to handle and to start. So by going through an accountant to setup a company legally, it will be much easier for inexperienced entrepreneurs.
These documents, licenses, approvals and insurance as well as other licenses are important to set up a business such as a cafe or a restaurant. Without this documents, the authorities will fine an inexperienced entrepreneurs without knowing the legal documents to apply. With the basic of financial accounting, Entrepreneurs could done the requirements setup and documents, licenses, approval without any hassle in order to setup a new hospitality business.
1. AIA Group Limited. (2012). Commercial Insurance. Available: http://www.aia.com.my/en/business/products-and-services/commercial-insurance/.Last accessed 26th October 2012. 2. Companies Commission of Malaysia. (2012). Forms. Available: http://www.ssm.com.my/. Last accessed 26th October 2012. 3. Tenaga Nasional Berhad. (2012). Pricing and Tariff. Available: http://www.tnb.com.my/residential/pricing-and-tariff.html.Last accessed 26th October 2012. 4. Information and Communication Technology Department, SYABAS. (2012). New Application and Registration (Domestic). Available:http://www.syabas.com.my/consumer/new-application-and-registration-domestic#1. Last accessed 26th October 2012. 5. Kuala Lumpur City Hall. (2012). Business. Available: http://www.dbkl.gov.my/index.php?option=com_content&view=featured&Itemid=648&lang=en. Last accessed 26th October 2012. 6. JABATAN BOMBA DAN PENYELAMAT MALAYSIA. (2012). Muat Turun Borang. Available: http://www.bomba.gov.my/main.php?Content=vertsections&SubVertSectionID=116&VertSectionID=114&CurLocation=114&IID=. Last accessed 26th October 2012. 7. Music Authors’ Copyright Protection (MACP) Berhad. (2012). Annual Licence Application. Available: http://www.macp.com.my/annual-licence-application.asp. Last accessed 26th
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Pew Pew Pie Cafe in Malaysia. (2017, May 25). Retrieved from https://studymoose.com/pew-pew-pie-cafe-in-malaysia-essay