Financial Planning & funding: Lesson 4
How Much do I Need to Start my Business?
Small business owner, Tiffany Nance, discusses five elements to consider when calculating startup costs for your business.
Topics:
- Be Realistic
- Complete a Startup Cost Analysis
- Determine Future Costs
- Project Business Income
- Compare Income and Expenses
Test Your Knowledge
To receive credit for taking this course through TSBDC, watch the video and take the quiz that will appear below to demonstrate your knowledge.
Video Lesson Topics
- 0:43
- Be Realistic
When starting a business, it is important to start small and keep an open mind. Issues, mishaps, and unexpected events will occur. It is best to not be overly optimistic about your business, and to not invest too much in the beginning.
- 1:20
- Complete a Startup Cost Analysis
Record the total cost of every item and service needed to get the business running. According to the US Small Business Administration, most micro businesses cost roughly $3,000 to start. Most home based businesses typically cost anywhere from $2,000-$5,000.
- 2:04
- Determine Future Costs
Future costs are as equally important as startup costs. When starting a business, consider all costs associated with the continual operation of the business. Record your total monthly expenses; examples of this include rent, utilities, raw materials, inventory, wages, and many others. Also consider costs associated with taxes, business filings, and renewals that may occur quarterly or annually.
- 2:48
- Project Business Income
The sale of products and services generates the business’ income. Some questions to consider when projecting your business income are:
- Who will be my customers?
- Is the product or service needed in the marketplace?
- What are your barriers to entry?
- What will be your marketing strategy?
- What will be your strategy to increase sales revenue?
- 3:30
- Compare Income and Expenses
Use the prior information discussed to compare sales income and expenses for your startup. It is important to compare them for a minimum of the next 12-24 months. Although most businesses do not immediately see a profit, this comparison is an indication of future profits and is used to determine business sustainability.
Topics & Lessons
Each Below Topic Contains a Video Lesson and Helpful Downloadable Information
Funding Options for Existing/Established Businesses
Loans
How to Prepare for Your First Bank Meeting
How Much do I Need to Start my Business?
Developing Financial Projections
Break-Even Analysis
Accepting Payments and Credit Card Processing
Funding Options for Starting Your Business
FinTech Loans
SBA 7A Small Business Loan Program
Want to learn more about how this topic relates to your business?
Schedule a meeting with one of our consultants! All counseling sessions offered by the TSBDC are no-cost and provided by our staff of professional business consultants.
