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In order to estimate necessary and suitable costs prior to start-up, you must
work out an establishing budget. How big the establishing costs get
depends on what kind of company you want to start.
Small investment
If you want to start a consultancy firm working in human resource development
you might only need a telephone, a computer and education/skills in human
resources. You probably have the education/skills and if you start the business
from home; the only expenses you need to start is a PC and a telephone. The
start will then be rather inexpensive.
Large
investment
On the other hand if you want to start a production making electronic devices
your establishing budget will be high. Before you can start selling your
electronic devices you need a production building, machinery, packing
facilities, skilled staff, a stock of electric components, office equipment
and...this may cost millions.
What expenses do you meet?
Below you find some of the most usual expenses when starting a business. In
your business plan you delete the ones you do not encounter in your new company.
- Remember: The less expenses the better. All expenses have to be paid
from the profit in your new business.
Expenses in an establishing budget
Premises
- Rent
- Deposit for purchase of premises or business
- Deposit (e.g. 3 months rent)
- Goodwill - payment to the former owner for his work at the premises
- Furnishing and renovation
Production equipment
- Machinery
- Tools
- Other things
Shop fittings
- Cash register
- Counter
- Other things
Office fittings
- Furniture (desk, swivel chair, shelves etc.)
- Computer (printer, network)
- Telephone
- Fax machine
- Copying machine
- Other things:
Purchase before start
- Raw materials/semi manufactured
- Manufactured goods (stock)
- Stationery
- Other things:
Car
- Deposit
- Other acquisition costs
Counsellors
Marketing
- Writing paper, business cards
- Brochures
- Advertisement
- Signposting
- Opening reception
- Other things
Other expenses
- Application for a patent/registration
- Other things
Total establishing costs are:
All the costs you get in the establishing budget will at a later stage be
transferred to your operating budget. Bigger investments will be transferred to
the company´s balance sheet.
The establishing budget is a snapshot of the cost you get before you can start
operating your company.
- Download a Establishing Budget from Shop & Downloadcenter
- Go to Operating Budget - an Explanation
- Calculate
your needed turnover and sales - easy online tool
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| Smlgomez, Gambia |
04-07-2012 |
Hi fantastic sharing of info, indeed! Anyone with experience to share on establishing, operational and cash-flow budgets for higher educational institution?
| Thomas Muloni, USA |
20-01-2012 |
Hi there,
I am doing research on business establishment, and just found your site very help ful. Thumbs Up!
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