It takes both courage and passion to launch a successful business. However, plunging headfirst into entrepreneurship is never a good idea. You must do your homework in advance before you go about establishing your company. One thing in particular you need to remember is the costs. The following are the main startup costs you need to know:
If you are setting up a business that manufactures and sells commodities, then you need the proper equipment for that. The actual cost obviously depends on the kind of products you are producing. If you are setting up a brewery, then you the equipment itself could be the biggest expense. However, if you are selling hand-made gifts or fashion accessories, then you may not need to spend much on the equipment.
Many budding entrepreneurs undermine marketing costs. There are so many things you have to think about in marketing video ads, digital ads, guest posts, PR, etc. So, the cumulative cost can be quite high. As a rule of thumb, expect marketing to take up around 10% of your total budget.
3. Logo Design
Every business needs a logo. In-fact, designing a logo is one of the first steps you do when starting a business. The cost of creating a logo varies – you can spend hundreds of dollars on your logo design or you can pay as little as $20 if you go with one of the many logo maker options like Tailor Brands or Wix.
How much you spend on a logo will depend on your budget. But, regardless logo design costs should be included in your budget plan.
Every business, whether big or small, should have an attractive and professional website today. Even if a chunk of your target demographic is local and won’t use your website, having a website is important. This is because, a good full-fledged website establishes credibility, and also allows other likeminded people in business and vendors to contact you easily. There are all kinds of web-hosting platforms and services that you can use according to your budget. All you need is the perfect plan.
There are different kinds of utility bills you will have to pay while running a business. These include the bills for electricity, gas, Internet, trash and recycling, etc. So, keep these in mind as well and do some research to get the best plans for your business. If you’re located in the city find the most affordable rubbish removal in Sydney CBD and shop around for the cheapest electricity and internet plans.
If you are going to sell products that you don’t manufacture yourself, you will have to purchase inventory from the manufacturer. The starting amount you need to pay depends on product demand. The higher the demand, the bigger inventory you need to maintain. Hence, the bigger the expense.
You can’t run an entire business on your own. Even if you are a solopreneur who wants to run a small part-time business, you need help from at least a few people. Otherwise, you will just burn out and destroy the business itself.
When you hire people, you have to pay them wages or salaries. However, you can save money by hiring fresh college graduates or even freelancers. In fact, one of the reasons why companies are choosing freelancers is that they are often skilled but charge a low price.
If you want your business to be in full compliance with the rules and regulations of the government, you have to pay appropriate taxes. The exact tax amount depends on the nature of your business and its size. You can find all the required information on this online. Otherwise, you can also hire a good accountant to help you out.
Just like taxes, insurance is something you can’t overlook. You need protection for your business, just like you need protection for your car, personal health, and family. The good news is that for most businesses, the total expenditure on general liability insurance, workers compensation insurance, and commercial property insurance is within the range $1,000-$1,500 which is easy to manage.
So, there you have it- some common business startup costs that every entrepreneur should know about. Be sure to take all these costs into account and adjust your budget accordingly.