Now itís time to plan your start up costs. Some businesses donít need much equipment. Most writers I know, for instance, get along just fine with a computer with an Internet connection, printer/copier/fax, and enough coffee to keep a small horse alert for days. Take a realistic inventory of what you need. For instance, if youíre selling homemade crafts online, youíll need the supplies to make the crafts. If youíre planning to start an eBay store, youíll need a good digital camera to take pictures of the items youíre selling. Donít forget the basic things every business needs like pens, paper, sticky notes, a stapler, tape, scissors, etc.
There are some things you can do to reduce these supply expenses. Buy items you will always need in bulk. Scan the Internet for great deals on new and gently used products.
Join and take advantage of frequent shopper programs. Tell your friends and family about equipment you needóyou may be stunned to find they have something similar that they were just about to donate to Goodwill.
Another cost of starting a new business that many people forget to factor into their equations is the cost of advertising. At first, youíll probably have to put out anywhere from five hundred dollars or more to let people know your business is out there. For instance, you may want to pay to have a website professionally designed or hire a writer or publicist to compose and submit press releases on your new business. The money might go to taking out an ad in the local paper or plastering your name on related Internet sites. Just make sure that when the time comes to market, youíre ready to rock. Youíll probably also want to join at least a couple of professional associations so you can keep track of the latest trends in your field as well as get a chance to socialize and exchange ideas with other people who run businesses similar to your own. Some professions require expensive continuing education units.
If you donít have the cash for these initial expenses, you might want to consider applying for a small business loan. If that isnít an option, choose one credit card strictly for business expenses and, using the money you make from your business, pay off the debt as soon as possible. Since most business expenses are tax deductible, itís a good idea to speak to an accountant or professional tax preparer early on to learn what you need to keep in the way of records.
Finally, if you are planning to quit your day job to make a go of a home based business, donít forget to build up your savings account. Ideally, you should have three to six monthsí worth of expenses in savings so that you wonít starve or be evicted from your apartment if business trickles instead of floods.