For first-time entrepreneurs, starting a new business can be a thrilling experience. However, considering its startup costs is a daunting task that might cause the venture to fail. Therefore, deciding startup expenses beforehand can help your brand generate more business income.
WHY CONSIDERING SMALL BUSINESS STARTUP COSTS IS CRUCIAL FOR EVERY ENTREPRENEUR?
A novice entrepreneur who neglects startup costs for his business whether small or big fails to thrive in the industry. Consideration of startup costs is a crucial decision in the career of every entrepreneur because it determines the success or failure of the brand/business.
WHAT SMALL BUSINESS STARTUP COSTS EVERY ENTREPRENEUR SHOULD EXPECT?
Here are the top 10 necessary startup costs for a small business to become a big success:
1. OFFICE SPACE
Entrepreneurs who are low on cost while starting out their small business can operate their business dealings from home in the beginning. However, a startup business needs to get set up in order to be well-established in the future. Location’s rent, designing an office layout, buying furniture, paying for the utilities, is all considered an office startup expense.
2. NECESSARY OFFICE SUPPLIES
You might need to buy office supplies to make your office space presentable. Do not overlook office supplies because they will cost you extra and will chunk up your startup budget. Buy limited supplies such as desk, phone, computer, and chair to operate your small business.
3. MARKET RESEARCH EXPENSES
In order to thrive in the business world, you need prior research about the market trends, work ethic, success stories, etc. A startup entrepreneur should not neglect conducting prior research because he will be unable to execute his ideas in the market. You can hire a professional from a market research company to assist you with your prospective industry. Consider research expenses in your budget.
4. NEED FOR EQUIPMENT
Your startup business will surely need equipment depending on your industry. If you are planning to open a restaurant, you will need kitchen space, a stove, utensils, other culinary items, etc. Regardless, if your business industry has an immediate need for equipment, make sure that you have enough budget for it.
5. PROFESSIONAL CONSULTANTS
It’s wise to hire professionals such as attorneys, bookkeepers, CPAs, accountants, etc. even though it adds up to startup cost. Consider outsourcing certain tasks with industry experts to grow your business in the long run.
6. LICENSING AND PERMIT FEES
Choosing a professional business entity to outsource your brand’s tasks such as having permits and federal licensing comes at a cost. Include licensing and permit fees as well in your business startup budget.
7. ADVERTISING OR MARKETING COST
Advertising is the best option to spread the word about a brand’s product or services. You need to consider expenses for marketing such as print ads, banners, brochures, business cards, etc. The best free-to-spread way is social media. You can use mediums like Facebook and Twitter to market your business free-of-charge until it starts generating sales.
8. TRADITIONAL UTILITIES
If you have just started out your business, consider paying for the traditional utilities such as phone, electric, Internet, water, and gas bills.
9. PAYROLL & BENEFITS
A business requires employers to work and the employers require payroll and benefits to generate the business sales effectively. Payroll includes stipends, bonuses, commissions, overtime, etc. You need to allot a certain amount of your budget to pay your employers.
10. BUSINESS INSURANCE
When an entrepreneur starts his/her small business, he/she needs to insure his/her company or brand. Your brand or business needs protection which could you save you money in the future.
In conclusion, as a new entrepreneur, you need to invest in your business from the start. Indeed, financing is the stressful part of starting out a new business. However, accurately estimating the startup expenses will make your business go a long way.