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Table of Contents

Web

Technology

Location

Legal

Personnel Management

Risk Management

Insurance

Business Success Tips

Sample Documents

Checklists

Contributing Authors

	Joe Kennedy Author of The Small Business Owner's Manual
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	Tom Severance Author of Business Start-Up Guide
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	Stephanie Chandler Author of The Business Startup Checklist & Planning Guide
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	Steven D. Strauss Author of The Small Business Bible
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Start-Up Costs

Start-up costs consist of every item you must obtain, and every expense you must incur and pay for, before your business is ready to open its doors. It includes the capital needed to acquire plant and equipment such as furniture, fixtures, leasehold improvements, computers, vehicles, and signs. It also includes capital needed for deposits, advertising, supplies, inventory, and training.

Make a complete list of all items you need to acquire and pay for before the business opens. You next want to think of creative ways to keep the actual cash paid out for these items to a minimum. Leasing, purchasing on an installment basis, and bartering are a few techniques. Cash is king in small business. Take all possible steps to minimize cash disbursements.

Every business is different. You need to carefully analyze your specific start-up cost needs. Small personal service businesses may have minimal requirements. Retail businesses and manufacturing businesses are likely to have substantial financial needs.

Make a list of items needed, date when needed, estimated total cost, and estimated up-front cash outlay. Here are some items to consider in your analysis:

Inventory
Real estate
Office equipment
Signs
Automobiles and trucks
Furniture & Fixtures
Leasehold improvements and repairs
Advertising, publicity, and promotion
Deposits for lease, utilities, taxes
Legal and accounting services
Government licenses, fees, and taxes
Wages and payroll taxes for training
Outside consultants and professionals
Architect and space planner fees
Office supplies and software
Prepaid rent, interest, taxes
Telephone system
Yellow pages directory advertising
Property and liability insurance
Fees and costs to obtain capital
Travel and investigation expenses

Regard your start-up capital, especially amounts needed for plant and equipment, as “cautious capital.” You want to minimize the actual cash outlay for these items by using some of the funding sources and techniques discussed later. Retain most of your cash for working capital needs.