Start up costs pose problems for all of us. They are instrumental in getting one into a fix and so measuring your stakes is very important. Here are ten beneficial tips on how to estimate your business start up costs.
1. First and foremost you need to think carefully and include the costs of all the various things you need in the estimated start up of your business. Always remember, that this amount is different from the basic amount cost required for your company to survive for the year. Beside this, there are various other things that cost money and that includes advertisements, chairs and office supplies, inventory, cash registers, and service supplies. The start up cost must also include provision for any other item that you may have forgotten.
2. Don't take out bank loans unless it is absolutely necessary. And even if you do ensure that you can afford the interest that the bank is going to charge. Also inquire about the interest rates, you wouldn’t want it to be too high.
3. Take into account your household expenses during the period that is the starting time for your business. Make sure you have adequate cash to cover the amount for the credentials to acquire a loan that’ll cover your needs.
4. You must be able to judge the amount of money that is required for your business to survive its first year. You also need to be prepared for any other sporadic expenses that might occur once in a while during that year.
5. Organize yourself so that you are ready for any extra additional costs that might come up intermittently through-out the year.
6. You need to take into consideration the food expenses for the entire year. Your budget should leave sufficient money for food and other basic expenses. This will cushion you from risks during the first year of business.
7. Your company requires credentials that’ll secure a loan in case your money runs out sometime during the year. It is advisable that you get a loan only if you can generate enough sales to pay the loan back. If your business is not doing very well during the first year then you might want to shut it down.
8. The salary that you have to pay to your employees, that is, if you have employees, is another thing that has to be kept in mind. That includes business insurance, any health insurance, and of course workers’ payments. You also have to pay an extra fee to the city for any part time and full time employees you have working for your company.
9. You may have to take tests to get certified depending on the nature of the business that you are starting. These tests cost money. Moreover you have to be aware of any other rules and regulations that your type of business entails.
10. You can always sell some personal belongings to get some extra money incase you don’t have enough. But ensure that your business offers sufficient security for selling these items. The last thing you want is end up broke having lost your company and also all your expensive belongings because you sold them to have enough money to start the company.