Unexpected Costs of Running a Small Business
Running a small business may seem easy to do on paper, but there really are so many other things that you need to think about. One of them is unexpected expenses because this can easily be the downfall of your business.
Extra Office Space
Sure, a home office may work for your small business, but zoning and other related regulations may require you to have something a bit more official. When making the decision to rent or purchase a property, you need to think about how much space you have now and how much you actually need. A lot of companies will offer you temporary office space, which is great if you are not quite sure which direction you need to take your business in, or even the arrangements that you are going to have. Utility costs can also eat away at your budget. Leased spaces will often include these types of costs as part of your agreement too, so look into those and always make sure that you are getting the best deal.
Equipment and Maintenance
The tools that you need to run your business need to be maintained. You may also need to pay out for equipment you didn’t think you’d’ need, such as a scanner, copier or even a shredder. Stationary should also be included in your budget because this can also eat away at your money more than you realise. If you want to save money here, then consider buying equipment second-hand from a range of auction sites. You should also buy stationery or any other related equipment in bulk, as this will help you to cut down on the cost per item.
Salaries, medical leave, health insurance and even training can factor in a large amount of cost for your budget. If you fail to invest in your employees by providing them with a reasonable wage or even a clean office environment then they will leave and this will cost you even more in the long-run. The cost of replacing an employee can be extortionate depending on the avenues you need to go through, so make sure that you set aside a good amount of your budget to accommodate this.
If your business is not secure then you will be putting it at risk. It doesn’t cost a lot to invest in
CCTV installation, but you would be surprised at how much it could help you to prevent break-ins. You should also focus on securing your network as well. This can be done through encryption, which will cost you, but it is most certainly a worthwhile investment.
Shrinkage refers to inventory loss at some point between the purchase you make for the items and the sale you make to your customers. Shrinkage can occur through vendors not shipping the required total of products, couriers losing packages or even poor inventory management. This expense can be entirely prevented by being diligent and by also making sure that you document and process every single step of the shipment until it reaches your customer.
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