11 Examples Of Startup Business Costs

Here are some startup business cost examples:

• Equipment

  You've got to get your equipment sorted before you start trading. If you're starting a restaurant, you'll need a kitchen and a construction company needs vehicles and tools. Ensure you've budgeted for everything you need and think about leasing or buying used/refurbished to keep the costs down. Once you're making money you can think about upgrading.

• Licenses and Permits

  Do you need a license or a permit to operate legally in your industry? A taxi company needs to ensure all their drivers have driving licenses and a restaurant needs food safety certificates. Check both local and national requirements or speak to a solicitor familiar with your industry.

• Insurance

  Something many business owners forget is insurance. You need to protect yourself against unexpected losses and liabilities, so ensure you have the right coverage for your industry before you start your business. Speak with an insurance professional if you're unsure of what you need.

• Rent and Office Space

  Have you got the right premises? Rents can vary wildly depending on both industry and location and it is important to not only budget for rent and other costs for your premises, but have all the deposits paid before you start trading. Could you choose a co-working space to save money?

• Stock

  If you hold stock, be sure to have the right amount to start trading with and have the procedures in place to reorder in a timely, cost-effective manner. Too little stock means you lose out on sales opportunities, but too much stock can tie up valuable resources. Especially in the startup stage, you should err on the 'more' side until you're sure of your regular needs. Is there any chance you can have items created 'on demand' and shipped directly by suppliers rather than holding stock yourself?

• Marketing

  If nobody knows about you, then you're not going to sell anything. Even before starting to trade, you must be marketing. Different types of marketing cost different amounts. Organic social media posting may seem free, but you may have design costs and ongoing monthly sharing costs associated with it. Don't forget signage and even flyers to deliver to households if that's right for your business. No matter your budget, it's important you measure your Return on Investment and make adjustments to your activities appropriately.

• Utilities and Energy Bills

  The energy crisis in the UK has forced many households and businesses to review their suppliers so it is important you plan for these bills as increases can affect your bottom line. Investing in energy-efficient equipment can certainly help, as well as replacing all those old office lights with newer LEDs and efficient heating within your premises.

• Technology

  Without technology, very few businesses could survive. This includes your website, software licensing, phone systems, and computers. Even an IT support contract to look after your tech. Upfront costs are only part of the overall expense as monthly subscriptions, maintenance fees, software upgrades and other updates eat into your cashflow.

• Legal Costs

  Do you need company formation documents? How about contracts or terms & conditions? This cost can vary depending on how complex your business is, so do factor these into your budget as well as costs for ongoing reviews. Solicitors may cost a lot of money, but you can be sure your business complies with all aspects of the law and won't be open to litigation in future.

• Tax and Accounting Costs

  And at a core level, don't forget to budget for your taxes and even your accounting fees. These often get overlooked when budgeting to start your business, but they are both very important. We always recommend you have an accountant on hand and if you can outsource your bookkeeping too, then you'll have a far simpler time of it.

• Employees

  And finally, how many employees are you likely to need? Hiring staff must be factored into your budgets and startup costs and getting it wrong could cost you even more money than you think. Do you need to hire HR to manage them all? Salaries, office space, perks ... these are all costs that add up, so create an accurate budget for your personnel because the right team can make the difference between success and failure.