How Much Money Will You Need to Start Your Business?

Have you decided that it is time to fulfill your dream of working for yourself in your own business? How will you get started? Becoming a startup business in the United States is a challenge. Just because you are a fantastic chef, for example, doesn’t mean you know how to budget for, build and/or run a restaurant. Consider these three tips.

Every Situation is Different

Becoming a startup is a challenge, but you will enjoy the flexibility of deciding what, when, and where your initial spending will take place. John Doe’s new restaurant, car wash, etc., has John’s footprints and fingerprints, so it will not be the same as yours. Some people dream of the business they want and have specific features in mind. Others want to follow a map that has been tested and comes with more assurances.

Many of those people choose to own and run a franchise of an existing entity. With upfront or extended payments, for example, a franchise charges you to join what is frequently promoted as a well-researched and tested business opportunity. Costs of entry are often higher and set by someone other than you. Some franchise fees can range between $49,000-$210,000, which can end up being a huge difference in your startup budget. But, reportedly, your chances for success are greater with the name recognition and market-tested expertise of an established franchise.

Set a Budget

Americans can turn to the United States Small Business Administration (SBA) for free support. The SBA often has budgeting information as well as other resources and suggestions that are particular to your type of business. The SBA even may have a sample business plan and budget that you may use as a management guide. Managing your books is a top priority, and doesn’t have to be hard.

When starting a business, entrepreneurs are immediately faced with capital expenses for items such as furniture, machinery, equipment, or other necessary fixtures. One option may be to buy or rent previously-owned items rather than purchase new ones. Noncompeting small business owners often are helpful and flattered when asked for advice on prospective customers, pricing for supplies and more.

Remember Marketing

Consider your marketing budget. How much does it cost to get a customer? Are you relying on word of mouth, digital marketing, using publicity, or a combination of activities? You should ask yourself all of these questions when determining your marketing costs.

Some statistics show that new businesses rarely survive for five years. You can beat those odds with focus, resources, and adhering to a strong business plan.

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