Many of us long to start our own business. Some of us want to work online out of a home office, and other people have dreams of opening their own shops, restaurants or offices. We look forward to a time where we can be our own boss and even employ staff to help us. Sometimes, these dreams go into detail. We write up business plans, we have lists of ideas and options, and we have firm ideas of what we’d like to do. Some of these dreams are born of bad days at work or inflexible working arrangements.
More of us than ever before are making these dreams a reality. We’re serious about them and are ready to take the first steps towards getting our startups off the ground. When we get to this stage, budgeting is an important consideration. We need to understand our startup costs and have a budget prepared. We need to know how much we’ve got, how much we need to borrow and how much investment we need to secure.
To do this realistically, in a way that will actually help you, you need to understand your startup costs fully. All of them. Most of us consider things like building rent and equipment, but other costs regularly get overlooked or missed off the budget because they just don’t seem significant. Let’s take a look at some of the expenses that you might not have planned for.
So many new businesses fail to consider the cost of their utilities. They don’t worry about Gas Oil Drums or water costs. They don’t think about how they are going to heat their office space or even essential costs like internet providers.
These costs can be a lot higher than you might expect, especially if you are opening a large store, office, warehouse or restaurant and even more so if you are welcoming the public in. Even if you work from home, you can expect your home utility bills to rise as you use more electricity, you heat your home more, and you upgrade other contracts. Do some research and factor these unavoidable costs into your budget.
No one plans for shrinkage, which is, put simply, the loss of inventory between you buying it from a supplier and it reaching the customers. We don’t want this to happen, we don’t always know what it happens, but it does, and without planning for it, it can be costly. Studies show that retail shrinkage costs U.S. retailers approximately 1.4 percent of their total sales.
Whatever your business, you need supplies. You’ll need pens and pads, printer paper and ink, chairs and desks. You’ll need toilet paper, tea bags, and a kettle. You might need an iron and cleaning supplies. Individually, these costs aren’t steep, but altogether it’s significant.
As a new business owner, you might want to consider hiring other professionals, like a legal advisor and an accountant, to help you to make sure that your business is within the law and your processes are right.