People love the idea of starting their own business. It gives them a chance to be their own boss, choose their own hours and decide what they want to do every day. Having your own business certainly has its benefits, but it isn’t always a walk in the park and is often a challenging process. A big reason for this is partly due to the many unanticipated costs business owners are responsible for.
While there are obvious expenses such as marketing, paying employees, and renting a location/office space, there are several other costs that may pop up that you weren’t expecting. Here are some of the expenses every potential business owner may face when starting a business for the first time.
Maintenance costs, depending on your industry, can be significant to plan for. If your business uses equipment of any kind, there is a good chance they will need to be cleaned or maintained regularly. You will also need to replace parts as necessary for pieces of equipment or vehicles you may have.
If this is the case, be sure to do some shopping and try to find the best deal. For example, instead of going down to the local store to pick up parts for your tractor, consider an online retailer like Costex. Comparing costs and shopping around can save you a lot of money over time.
Maintenance costs can vary but can easily add up to hundreds or thousands of dollars a month, depending on your business. Also, if you put off maintenance, it could hurt the efficiency of your business and cost you more in replacement in the long run.
Legal Fees And Permits
While this depends a lot on your industry, there is a chance you will need to pay legal fees or permits to get started. This could include a business license, a permit to sell alcohol or dozens of others. Having these legal requirements in place ensures that you are legitimate, but many may come with a cost. If you don’t plan for these costs ahead of time, they could surprise you, and you may even have to pay extra to rush documents through the process.
Not only can applying for these or buying them be expensive but if you miss one or do something incorrectly, you could be financially penalized. Non-compliance costs can be through the roof, and it is always better to ensure you are playing by the rules. If you’re not sure what type of legal responsibility you have, it is a good idea to speak to an expert.
While this is not a direct cost you will need to pay like the others, payment delays are certainly a financial issue you need to consider. While it would be lovely if your customers and clients always paid you on time, this may not always be the case.
In addition to client delays, other delays in payments can also occur. This could be a holiday or weekend delaying payment or your bank holding funds. If you don’t think of these delays, there could be a time when you find yourself without the money you need to operate safely due to a delay.
Along the same line, things like shrinkage could also hurt your bottom line. This is the amount of inventory you lose due to theft, loss, or damage. While this might not seem like a lot, businesses lose billions to shrinkage each year, and it needs to be considered when talking about costs.
Costs You Shouldn’t Forget
Running a business can be a good way to make a living but can come with a variety of different challenges, including managing your budget. Payment delays, legal fees, and permits, as well as maintenance, are all things you need to keep in mind financially to ensure running your business runs smoothly and profitably.
If you are interested in even more business-related articles and information from us here at Bit Rebels, then we have a lot to choose from.