Basic Business Startup Costs

Starting your own business is an exciting, but risky proposal. It can also be expensive. Before you even get a chance to open your doors for business in a world where most small businesses fail, you will be incurring expenses. Even if you have customers lined up to give you business, you need to make sure you've covered all the startup costs first. Basic business startup costs include a long list depending on the business you are going into, but we'll discuss a few of the very basic costs that every business will encounter when first starting.

Business Licensing Fees

To legally operate a business in any state, you first have to obtain a license from the state. A business license also gives you a form of legal protection in event of a lawsuit. Your state filing fee and additional licensing fees will depend on the state you choose to incorporate you business in, but it can range anywhere from $25 to $300.

When incorporating your business you may consider having a professional service take care of all the legalities for you. Firms will typically charge anywhere from $50 to $200 in addition to the state fees, but sometimes the additional fee is worth it because it insures you don't make costly mistakes in setting up your business, and the services will often give you additional perks, like a corporate stamp, which you'll need in setting up a business bank account.

Building a Business Identity

The next area to consider startup costs in would be in building your business identity. This may be the easiest part to cut costs on, but it can also hurt your business significantly. Some small expenses, like building a website with a professional email address, can go a long way in gaining credibility in your business. Domain names can cost as little as $8 a year and if you are using a web hosting service, they usually only charge $10 to $20 a month for the hosting and professional email address. If you aren't experienced in building websites, hire a professional to do it for you. Spending a little time and money on your web presence can go a long way to generating you business.

The other part of building your business identity is designing a company logo and getting business cards. Once again this can be easy to scrimp on, but worth every penny if it's done right. Your logo is the first impression any potential client gets. Make sure it is a good one that conveys your product well. When you are printing business cards, avoid printing them at home. Clients can tell if your business card is a do it yourself type. Professionally designed and printed business cards tell your client you are committed to your business and that they can trust you, plus the ink doesn't run if the card happens to get wet.

Accounting

Another investment you will want to make when considering business startup costs is whether you will purchase accounting software, hire someone to do your accounting for you, or hire an accounting service. Accounting is crucial to making your business successful, so its not an area you will want to skimp on. Not only will it keep your accounts straight and make sure you haven't billed a customer twice, it will also help you find those tax deductions that can save your business lots of money.

Other Startup Costs to Consider

There are several other startup costs to consider as you begin your own business. Those can include, but are not limited to:

• Attorney and Consultant fees.
• Merchant Account fees so you can accept credit cards.
• Telecommunications like a business phone line, a toll-free number, fax number, and high-speed internet.
• Permits and Insurance that depend on the type of business you are going into. Consult a professional or state business licenser to find out what permits and insurance your business is required to have to operate.