Don’t be April-Fooled :: The Real Cost of Starting Your Own Business

Don’t be fooled! Many people falsely believe that starting up a business is as simple, and inexpensive, as printing a box of business cards. Savvy LaunchHER League members have learned otherwise.

Most businesses have numerous start-up expenses before they hang out their virtual, or brick and motar, shingle. For example, jewelry boutiques and wedding photographers alike may have paid for some initial legal work, a logo design, marketing materials like brochures or product displays, and help with web site selection and development.

Plus, even if you don’t need a start-up loan, you may need to set aside some cash for when your company launches, create some initial inventory if your business is product-based, and wish to purchase other assets. For example, you may need equipment for producing your product (a camera? sewing machine? kiln?), office furniture, a computer, and so on.

Then there are the surprises.

Erin Palacio of {forever} Grace – Tomorrow’s Treasure said that she has learned to see the true cost of her products, including fees paid to Etsy and Paypal. However, she noted that she was surprised by how much she needed to save for tax time.

“Dreaded taxes! Originally, for some reason, I wasn’t taking them into account, so my most surprising cost was putting back 25% to 30% for taxes!” she says.

Cutting costs was something that Diane Perry of Catcophony Wearable Art learned from previous business experience and one initial, time-consuming year-end.

“Having had a professional practice I pretty much had an idea of start-up costs, supplies, and equipment issues as well as record-keeping. But the one area I did not have to deal with in my practice was inventory, at least not to the level that someone who produces a product – a manufacturer – must. The first year’s tax prep with my accountant was overwhelming. But we have streamlined the process and now I track everything on Excel spreadsheets,” she says.

Every business is unique, and the cost of starting one business will vary from any other, but one thing holds true for all: planning is crucial because it eliminates surprises. Use free resources like SBA.com (U.S. Small Business Administration) and find an inspiring mentor with plenty of business experience. Join affordable networking groups like LaunchHER League (for women only!) or artisan groups online or in your neighborhood.

And then, pick out some really cute business cards. You deserve them!

See also –  Don’t be April-Fooled :: Starting a Business is Hard Work!

Comments

  1. This is such a good read. I knew nothing about business when I started and can’t believe how much I still need to learn. It isn’t just about doing what you love as an art, you really need to know the legal aspect as well. I was a teacher for 15 years and am thinking about going back to school and take business courses so I better understand what I am supposed to do. Thanks again for this great article!

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