What Should Be Included in a Startup Business Budget? (Part II)

Continuing our discussion of what to include in your startup budget, here are three other areas to consider:

Equipment & Inventory: Now that you have secured your location, you will need to acquire the equipment and inventory needed to operate the business. This is an area where there will be some flexibility. To keep expenses lower, you may be able to lease some of your equipment and/or purchase it second hand. You will also want to talk with a professional accountant about the tax implications of how you expense your equipment. Your startup inventory includes all the supplies needed to operate your equipment and open your doors for business.

Marketing: Once you are ready to open up, you will need to get the word out to your target market. There are many ways to do this (both online and offline), and this will require a full evaluation of your business to determine which advertising and promotional methods will work best. In the beginning phases, the marketing budget should be generous because there will be a learning curve in determining how best to reach your market; it is better to err on the side of doing too much rather than too little. Just make sure that you track where your customers are coming from so you know which advertising methods are most effective. Down the road, you can refine your marketing processes to use only the methods that are producing the best return on investment in terms of customer growth.

Miscellaneous Expenses: Miscellaneous expenses will cover all other projected startup costs that do not necessarily fit into another category. These may include incorporation, business licenses, insurance, legal guidance, accounting, and professional business consulting. For startups, the help of a business consultant can be invaluable in ensuring that all expected expenses are accounted for and that no major mistakes are made from the outset. For this reason, seeking the expertise of a business startup professional can pay big dividends in the end.

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