Starting a new business is potentially one of the scariest things you will ever do in your adult life, even when compared to having children. Babies, as scary as they can seem, generally all work in the same way and their behaviour becomes largely predictable. Having a business, on the other hand, can be incredible one day and insanely terrifying the next. You will fall eventually into a rhythm with both though, so don’t panic. The most important thing to remember when starting your own business is that it is nothing like what you have seen on TV. Businesses, especially start-ups, require money and sometimes a lot of it. You may think you’ve factored in all the costs but you probably haven’t – here are 5 less common costs that you need to know about before starting your own business:
1. Insurance
Business insurance is a requirement of the law in most states, especially when your business is open to the public. Trust me, if anything ever did happen and your business got sued for a slip and fall injury, you’ll be grateful that you had that insurance to help with legal experts. Insurance premiums will vary, depending on your coverage so consult with your broker to determine the recommended coverage option for your business.
2. Permits
Permits are the worst kind of hidden business expense but they are a necessary part of doing business within your community. Permits are, unfortunately, rarely a once-off fee and your business will likely have to continue paying these from time to time for the entire time your business is operational. Before you start or buy a business, consult your local government offices or chamber of commerce professional groups to get more details about your area.
3. Software Licensing
We all know that new businesses require office equipment like computers, scanners, and printers but most of us forget that those computers require software programs that need to be licenced. Licensing costs can sneak up on you, especially the ones that require annual fees so take note of when your next payment will be due and set a reminder for a few months in advance so that you can make sure you’ve set aside that money.
4. Employee Benefits
Employee benefits may seem like an unnecessary expense but they almost always pay off. If your employees are the right fit for your company then giving them added perks for working for you will make them feel appreciated, in return they will work harder for you.
5. Utilities
Everyone knows that office rental is a major expense for most businesses but few companies realize how much they will be paying for the utilities for that office space. Power bills, water bills, sanitation costs, as well as heating bills will need to all be factored into your business’s monthly budget. Do your research and shop around for providers that will offer your company competitive rates for your utilities. If possible, consider frequent energy audit programs because these can help improve your business’s overall energy efficiency.