The early days of starting a new business are both stressful and exciting in equal measure. During this period, even the most well-meaning entrepreneurs can make mistakes. This is normal, but that doesn’t mean that you shouldn’t try to avoid them. Here are some of the most easy expenses that start-ups tend to overlook.
Insurance is one of the most important purchases any business can make. By law, you are required to have employers’ liability insurance, which will cover the compensation necessary if one of your employees is injured in the workplace. It’s also highly recommended that you take out public liability insurance as well as buildings and content cover. Negotiating a better deal will be more difficult if you have no previous experience running a business, but you should expect to get a better rate over time.
As the owner of a business, you’ll now be responsible for ensuring your company follows all of the rules and regulations that govern your industry. Staying up to date with all of the details can be a time-consuming process, though, so you may want to consider consulting a third-party specialist like Just Accountants to get you up to speed. This will ensure you have all of the information you need to move forward with your plans.
In business, shrinkage refers to the loss of inventory resulting from theft, both from employees or the public, or administrative errors. While this may seem like a minor problem for small businesses, having an inaccurate inventory count could result in your business being unable to fulfill orders in a timely manner. This will not only cost you valuable time, but it could also damage your reputation and risk losing you future sales.
Finally, you’ll need to understand the importance of exchange rates. Even if you aren’t considering trading internationally right now, this will still impact your business as you most likely import goods from overseas. Just a small fluctuation could make a large difference, especially if you’re buying/selling in volume. If this is the case, consider negotiating a deal with your supplier where you pay a fixed rate in advance.
Did you make any easily avoidable mistakes early on in your business? Tell us all about your own stories in the comments section below.