Starting your own business is an exciting time!
Your mind is buzzing with big-picture ideas and strategies of how you will reach your goal. Unfortunately, this is why some of the finer details surrounding expenses can slip through the cracks.
An alarming 50% of all businesses fail.
Poor financial planning and mismanagement of capital are two of the leading causes of the demise of a business. Therefore, it is crucial to explore all the startup costs affiliated with running a business to avoid any nasty surprises later down the track. To help you on your way to your first million, we have made a list of the most common startup costs incurred by businesses and how to minimize them.
Licensing & Fees
Registering your business name and applying for a business license are two of the key steps needed to create a business. If you are launching your business in British Columbia, these 2 steps can be completed quickly and conveniently online here.
Some other costs you will incur are:
- Employee benefits
- Business insurance
- Registration with local tax authorities
- Permits (e.g. service of food or alcohol)
For the first couple of months, working out of your home may be a brilliant solution. However, as your business intensifies, and demands increase, you may want to explore other options. Renting an office space in the heart of the city can be incredibly expensive. Paired with that the idea of committing to a 6-12-month lease can be terrifying, as you are unsure where the business will take you. Joining a business centre is a great way to ease yourself into entrepreneurial life. Here at the Guinness Business Centre, we offer a range of plans to suit any type of business from fresh startups to large corporations. Starting off with a virtual office plan can be a great way to begin your business journey as you can choose between the prestige of the city or the comfort of home for a premium price.
Equipment & Utilities
Electricity, internet, phone bills and heating are just some of the costs you can expect when opening your own business. Paired with that, depending on your industry, you may be met with a lengthy list of items such as a computer, printing equipment and a company car etc. that are essential in running your business. Plotting out a budget prior to commencement is an excellent way to prepare yourself for the ‘everyday costs’ affiliated with running a business. Or else, join a coworking space, where all your utilities are covered in your membership.
Before launching your business, you will want to spend a bit of money circulating your brand and promoting your services to ensure you accrue sales. Establishing a professional and informative website is crucial in any marketing plan, hence why you should make purchasing a domain name one of your top priorities. There are many platforms that offer this service, click here for a helpful guide. Once you have an established website, sharing simple advertisements on the platform is a great way to get started. You can then link the advertisements to your social media channels which will help boost your SEO and awareness without breaking the bank
Taxes & Payroll
‘In this world nothing is certain but death and taxes’ – Benjamin Franklin
This guide would not be complete without the inclusion of business taxes, the mandatory expense disliked by many new businesses. Taxes can be complicated and will depend on a variety of factors including whether you are self-employed or listed as a corporation. Some taxes that most businesses in British Colombia will need to pay are:
- GST (Goods and Services Tax)
- PST (Provincial Sales Tax)
- Employment/Payroll Tax
- Income Tax
- Property Tax
To ensure you are operating in the most profitable way by minimizing the amount of tax you are liable for, consulting with an accountant is highly recommended. Click here for a Tax Guide for small businesses by Fundera.
Starting your own business can be daunting, however, the positives can vastly outweigh the negatives. Freedom, flexibility, control and increased earning power are just some of the benefits entrepreneurs and small business owners experience when pursuing their passion.
Ready to take the plunge? We have a variety of private offices to rent and virtual office plans to choose from.
Let us help you make your entrepreneurial dreams come true!