If you’re starting up your small business, one of the first things you will think about is the cost involved.  However, if you then have limited time and resources to ensure that all matters regarding costs are covered, here’s a quick checklist to use to help cover the basics of business start up:

  • Up until now, your idea may well have just been lurking in your head, and it’s easy to make numbers look good on paper!  So, if you haven’t done so, explore your business start up ideas and their relative costs with a good friend or colleague.  Make it clear to them that you want their role to be that of a critical ally: invite them to question you about the cost aspect (in the manner of a bank manager if necessary) as this helps you to hone your ideas and make sure that your thoughts about costs (and the way you present them) are realistic and sensible.  Make notes as you go so you don’t forget key points and actions to follow up on.
  • Research your competitors in the field that you are looking to set up in.  If it’s retail, have a go at being a ‘secret shopper’ and see how you would improve on the shopping or product experience that the competition is offering.  Try to reckon their overhead costs in relation to the product’s sale price to judge their mark up and see how this compares to your own.   If it’s a service being offered, again research what is on offer and at what cost – is this cost reasonable?  If it’s a cost you can’t beat, why is your service, at the same or higher cost, a better option for the customer?  Time to think through all of these questions!
  • If you haven’t drawn up a business plan, make sure you do so.  This document is the outline of what your business is, what it offers, how it is funded and what the costs are likely to be.  The act of drawing up the plan itself should crystallize your thinking about your business costs.  If you have already drafted it, return to it after your meeting with your ‘critical friend’ so that you can include the answers to the financial questions arising.
    Once you have completed all of the above, consider whether you have been realistic about your business start up costs.  If you find you need more funding, investigate business start up grants in the first instance.  Obtaining a grant can cost you far less in the long run than business start up loans, so check to see if there are any district or industry grants available in your area.
  • Shop around to meet additional costs that you may have forgotten, such as public liability insurance and contents insurance that covers your business goods and materials.  Don’t forget to research and pay any fees for consents for change of use or renovation of premises, eg: to change a residence into a business premises.

Lastly, do make sure that you carefully research the deals available for business banking.  In the current economic climate some banks have tightened on lending, so if you know you want to start a business at some point in the next year or so, open at least a basic checking account with your preferred bank, then you are already a ‘known’ customer when it comes to seeking funds for your business start up!

Related posts:

  1. Resources for Small Business Start Up
  2. Starting a Home Business
  3. Business Loans and Finance
  4. Starting an Internet Business
  5. Finding the Right Business Insurance for your Business

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