One of the most tricky parts of the startup process of a business is the planning stage. This is the stage where you need to consider the set-up costs. It can be easy to miss out on some expenses that may be less obvious than the others.
Below, we discuss the typical costs that are often missed out in the planning stage.
Permits and Licenses
Startups need to apply for permits and licensing to run. While the costs are typically small for each item, the expenses can add up quickly.
List and break down the permits and licenses that you need to run your business. Find out the cost of each one and tally them up. If only a few expenses are required, then the total cost could be fairly substantial.
Domain & Email Hosting
You will need to have a website domain along with a custom email to appear more credible as a startup. Startups often overlook this cost while planning for more significant expenditures.
Check your domain name’s availability and its pricing beforehand, or try and look for a web hosting company that can provide you with a bundle deal. You can also consider domains that do not end in ‘.com’—like .org and .net—since these extensions are often easier to secure and more affordable.
Staff Salaries
No matter how good your startup idea may be, it cannot be executed properly without additional human resources. You will need to offer competitive salaries to attract new staff for your startup.
These monthly wages will be one of the high ongoing costs you need to plan for. Consider getting a business loan to help you prepare for the staff costs in the first few months.
Business Insurance
Necessary business insurance policies such as public liability and professional indemnity can protect you from being sued by members of the public or against claims of negligence.
Prioritize these insurance policies to protect your growing venture, and consider getting other relevant insurance policies as you grow. You can consult an insurance agent to help you with this.
Utility Bills
You will need to pay the utility bills for internet, electricity and water access at your startup office, no matter how small your space is at the beginning. If you have more equipment to run, you can expect your utility bills to be a little higher than usual.
You will also need to have a backup plan for when your access to these utilities goes down unexpectedly. Look for green and energy-efficient solutions to help save on these costs. Shop around for the best deal offered by utility companies.
Shipping Fees
If your startup offers products that can be delivered to your customers, consider the logistics and the shipping fees required for different areas. Your product size determines whether you are charged by the parcel’s weight or volumetric size so keep that in mind too.
Compare several logistic service providers to find one offering the best cost and services for your average shipping volume per day.
Taxes
Startup or not, every business needs to plan for taxes. These taxes can include sales tax, income tax, property taxes or others depending on the nature of your business.
Perform research into the types of taxes that you will be liable for so that you can prepare for these payments better. If you’re not sure about your taxes, you may want to hire an accountant or a finance manager to help you sort it out.
Professional Costs
Hiring a licensed accountant to help you sort your taxes or a certified electrician to configure the wiring in your office provides assurance that the job is done correctly.
Consider the types of professional services that you will require to set up your office correctly in advance. You can also look for annual or bi-annual financial commitments that you will need to make to keep your business running smoothly.
