Thinking of starting your own business? Most startups require some initial investment in order to get them off the ground. Whilst many budding business owners will budget for things such as equipment, marketing and hiring employees, others costs can sometimes get overlooked. Here are just a few hidden costs to be wary of when starting a business.
Licensing
There are a lot of business activities that require a license. If you plan to make and sell food, you’ll need a food license. If you plan to do electrical work, you’ll need an electrical license. If you plan to play music to customers, you’ll need a music license.
Such licenses can vary in cost and some of them may require passing a course first (such as an electrical license). You can find out online which licenses you really need by taking this quiz.
Insurance
There are some forms of insurance that are mandatory by law. For example, if you’re taking on employees, you’ll need to have employer liability insurance. There are other types of insurance that aren’t compulsory but are recommended such as public liability insurance – this protects you against any injuries you may cause to the public (some customers may not take you on if you don’t have this insurance, especially in trades such as construction and extreme sports).
Whist insurance can be a big cost, there are many ways to bring down the price. Business insurance packages such as this one from Hiscox can cover you for multiple schemes often at a lower price than were you to take them out individually. Putting in places security and health and safety measures (as detailed below) could also help to lower your rates by making you less of a risk.
Security
Securing your business is essential if you don’t want to be a target for thieves and fraudsters. There are all kinds of forms of security that you may want to invest in. If you’ve got an office or a store, you may want to install a burglar alarm and install CCTV. If you need to screen clients, you may want to invest in these robust identity verification services from Netverify. Meanwhile, when it comes to protecting your digital data, you may want to invest in security software to help fend off viruses, screen incoming emails and protect you from hackers.
You probably don’t want to skimp on security, although that doesn’t mean you won’t be able to find deals. Cyber Monday is often a great time for saving money on security gadgets such as burglar alarms. As for security software, you’ll find many promotions online (although you should always stick to trusted security software companies).
Health and safety
Health and safety is also important – it may even be compulsory in some instances. For example, if you hire employees, you’ll need to have certain fire safety in place by law and you may be legally required to supply certain safety equipment. Optional health and safety measures such as signage to warn people of low ceilings or hot taps could also be worthwhile – it will help your defence if you get sued and it will lower your insurance rates, on top of preventing injury.
Like security measures, you can’t go cheap on health and safety, although you may be able to find promotions online for health and safety equipment or extinguishers. Always ensure that you’re buying from a trusted seller so that you know you’re getting good quality equipment.
Utilities
A lot of business owners don’t consider the added utility usage that can come with running a business. If you’re renting an office and you have lots of computers, you’ll be using up a lot of electricity. If you own a bar or restaurant meanwhile, you may be using a lot of water for cleaning purposes.
Your utility bills are something that you can save money on in a variety of ways. Buying energy-efficient equipment can help you to spend less on electricity – these PCs listed at Energy Star are a good example. You can also consider measures such as motion sensing lighting that turns off when no-one is in the room or push taps that prevent people from leaving taps running. It’s even possible to invest in sustainable energy sources such as solar panels in order to save money.
