Have you decided that working for another company just isn’t for you? Do you consider yourself the risk-taker who is filled with ideas and wants to create something all your own? As a budding entrepreneur, there is no doubt that you are jumping at the bit to get started and carve out your own successful company, but there is a lot to consider and keep in mind before you take the plunge.
The cost of starting your own business is no small figure, and all too often entrepreneurs end up shocked and struggling to come up with enough money. There are plenty of items that entrepreneurs forget about, don’t consider, or don’t properly price out that can end up sinking the business before it even gets off the ground. So, to help ensure that you go into the process with eyes wide open, here are some lesser talked-about costs you’ll need to factor in.
Business Energy Costs
When you have an office space, or even a factory, there are all kinds of operating costs that go along with it. Entrepreneurs tend to give a lot of attention to the rent or purchase price of the land/building, but what about the energy costs that will incur to keep things up and running? This can be a real grey area. Not only that, but not every energy provider in the UK offers the same rates. By not taking the time to do your research, you could end up choosing a provider whose rates aren’t at all competitive, thereby costing you more in the long-run.
A great tip is to check out the Utility Bidder website which allows you to compare business energy quotes from the top providers in the UK. Not only will you be able to see first-hand just how much the rates fluctuate, but Utility Bidder also has access to exclusive rates and deals that can save you big bucks.
Business Insurance Costs
Here’s one that isn’t glamourous in the least bit, and is very rarely discussed, however, it is extremely important to factor in. Business insurance will protect your company from all kinds of things that could otherwise spell financial ruin due to theft, fire, a lawsuit, and so forth.
Some of the most common types of business insurance include employer’s liability, public and product liability, professional indemnity, and building and contents insurance.
It’s a good idea to speak to an insurance agent that deals with businesses and get their advice on what is suggested, and what the cost to you would be. Remember that just like with the energy costs, all the various providers will have different prices for their plans so you’ll want to shop around.
The Cost of Equipment, Upgrades, and Regular Maintenance
Then there is the cost of your equipment (the initial investment), the upgrades, and regular maintenance. This is obviously going to differ from business to business, so it’s wise to get a cost estimate of these items before you go ahead and make purchases.
A money saving tip for these items is to look for second-hand equipment, and rental/leasing companies to get the items from.
Unfortunately as your business grows, you’ll inevitably have legal costs. These are usually pretty standard – costs of incorporation, costs of defending your firm against lawsuits or the like.
One unfortunate reality is that you are in manufacturing, you might have to defend your company against product liability lawsuits. In the event that this happens, you’ll probably want to hire a good law firm. If you are in Massachusetts we recommend Schafer Law, they’re a smaller firm out of Boston, but they have a wealth of experience. Give them a call if someone gets hurt using a product that you made or had a hand in making.
A More Accurate Picture of the Cost of Business
Factoring in these little talked-about costs will help you to get a more accurate picture of what it will cost to start your own business.