What expenses should you consider before starting a startup business?
In today’s article we will focus on startup businesses and the costs it has to go public. The process, to build something of our own, with a personal touch, is not easy. It takes time and money. Specifically, we will see:
- What is a startup business?
- What costs are involved in starting a startup business?
- What are the annual costs of a startup business?
Startup business – What is it?
We will start from the very basics, i.e. the definition of a startup business. Startup business, we call the term, which usually refers to companies that are in the first stages of their operation.
Startups are founded by people who want to develop a product or service that they believe will be in demand and how it will solve a problem, so they aim for large and rapid growth.
Many times startup companies start with high costs and limited funds, which is why they look for financing from external factors who will believe in the founders themselves and take their idea one step further.
Note that a startup company does not always bring a 100% ready product to the market, but “launches” it in its simplest form (MVP), in order to first ascertain the demand it will have from ordinary consumers, so that then delves into its completion.
What costs are involved in starting a startup business?
Creating a startup business from scratch requires, as we mentioned above, time and a lot of expenses. So what are the expenses required to start a startup business?
No matter what startup business you want to start whether it’s online or with a physical store, there are basic first costs. That is:
- Research costs: Some entrepreneurs choose to hire market research firms to help them with the cost evaluation process. In this way, basic questions will be solved, as to what market size you will address, the possible revenues you will have, the appropriate location for your headquarters, the competition, the rest of the consumer habits, etc.
- Insurance, certification and licensing fees In several regions, some companies will be required to undergo health checks and certifications in order to obtain the appropriate permits. In still other companies, it is necessary to obtain basic licenses, while in some others it is necessary to obtain specific rights of the sector in which they operate.
- Equipment and supplies: To begin with, the respective owner must decide whether to rent the equipment or to purchase it. A leasing lease can be a good solution for your first business. A company that offers device leasing is Finloup!
- Promotion and advertising In order to become widely known, your startup business must be advertised and accordingly on social media or wherever else you think you will win more customers, always depending on the target audience.
In addition, expenses to consider before starting a startup business include:
The Cost of Borrowing
What salary will be given to the first people who will make up the company
Technology Expenses – depending on the company you would like to establish and the target audience (for example, you will use different technology if you open an online store with electronic cigarettes and another technology if it is a physical store with beauty products.)
The GEMI Establishment Cost which amounts to approximately 80 euros, always depending on the company
What are the annual costs of a startup business?
After your company has officially started, there will be some standard expenses, where they will be annual and they are for the benefit of the company, so that it is legal and “clean”.
In other words, these are the costs related to:
- The lawyer who will be at your company’s side and will advise you on any issue that may arise.
- Accountant, it is roughly estimated that the book class starts at 300 euros/month)
- CHARGE = 100 euros (annual cost)
- Company stamp, which costs around 15 euros and is required everywhere, on all your expenses and on every item that must be delivered for the company
- Employee salaries, leaves, badges, IKA
- Application fee (it is something that is paid at the end of the first year and amounts to between 400 and 1000 euros
- The rent you pay for your headquarters, as well as anyone else used, i.e. PPC, internet, water, etc.