Starting your own business is exciting, but you must also focus on your numbers. This includes budgeting, accounting, and bookkeeping.
Do you want to run a successful business? You must consider the startup business expenses below in your budget.
Estimating an accurate startup cost will help you meet your business goals. Before starting your business, get the funding that you need.
Professional and Legal Costs
Registering your business is one of the first major steps. Obtaining an LLC is only around $100, but it depends on which state you live in. There are other ways to register your business. Some people choose to register as a corporation or limited partnership. Find out what to register your business as and add in those costs.
You must consider any copyrights and patents that will protect your business. This brings you to the cost of lawyers. These people are important when signing and creating contracts with clients and vendors.
Get potential customers to know about your new startup business. You must invest in marketing. The first step in marketing is developing your branding and packaging. This gets people interested in your business, shows personality, and makes a memorable mark.
After you invest in branding, choose marketing that will reach your target market. Focus on online marketing. This includes website ads, social media ads, and social media accounts. You can also choose a non-digital form of marketing like newspapers and billboards.
Attend trade shows and local festivals to get your brand noticed. Offer freebies to potential customers. You need to add this cost to your budget.
It is non-negotiable to run a company without a website these days. Hosting a website costs money, and it depends on which host you want to use. If you aren’t tech-savvy, build your website with templates from Squarespace or Weebly. You can choose to outsource to a web designer to build your site, but this will cost you much more money. Research which option is best for your business and your budget.
Other technologies like computers, printers, phones, and Wi-Fi are necessary to get your business up and running. For businesses that will have a brick and mortar location, having a register and credit card machine are important costs.
Product and Material Costs
If you plan on selling tangible goods, you must consider the cost of the products or raw materials. The first few purchases from your business may even cost your business money. Add in the cost of your warehouse, shipping costs, and shipping insurance into the price of the materials.
Take anything and everything into account when starting your business. This includes small items like paper, staples, and pens. You are also going to need furniture like desks and office chairs. Where is this furniture going to go? You must consider rent costs and utilities for the first year as well.
Hire a Bookkeeper and Accountant
A bookkeeper creates invoices, tracks billing, runs payroll, and creates general ledgers to document all transactions. They ensure that all financial data is correct and coded to the right accounts so that the information is both accurate and easy to access.
An accountant also deals with the ongoing finances of a business, but the main difference is that they handle finances that are already finalized and closed out. Accountants interpret financial data that the bookkeeper documents. They compile the information into financial reports. These reports give your business an idea of your financial progress. This helps to analyze the growth of your business and gauge any changes that you may need to make. Accountants also provide tax planning and advice.
Accountants and bookkeepers complement one another. They are both equally important to the success of your company. Although starting a new company is overwhelming, remember that there are people here to help you. Get a mentor and outsource work to other business professionals when possible.