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How to plan for start up costs

Finance Learning Lab is pleased to share this blog article and free interactive online course for the Business Link community to help new business owners plan for start up costs.

To get started, click on the “start” menu and follow along with the videos, audio and animation. You can also read along below for a summary of the key points and refer to the blog article notes as a refresher as you progress through each stage of planning costs for your new business.

There are four key steps to getting started with building a plan for your new venture start up costs.

Step 1: Get a template

  • Select an excel spreadsheet, piece of paper or simply use the free template included in this micro-course.
  • We have a free template you can download here (insert hyperlink by Aug 20th)

Step 2: Brainstorm cost categories

  • Set a timer and brainstorm as many cost categories as you can think of. We will help you along with triggers.

Step 3: Estimate the dollars

  • For each cost category, investigate or estimate the dollars for that line item.

Step 4: Evaluate the start up plan

  • Step back from your list to evaluate and reflect. We will guide you through many questions you should ask yourself.
It is also important that you give yourself a moment to reflect on why you are building a plan of your start up costs.

There are several categories of stakeholders that will find this document relevant:

Banks and investors

  • This is critical information anyone investing or loaning you money will want to see.

Employees and advisors

  • New team members and advisors can better help you when they understand your plans.

Spouses and life partners

  • This can help you alleviate concerns loved ones might have and help get their buy-in.

Perhaps most importantly, YOU

  • A start up plan is fundamentally a document you create for yourself as a tool to help you make your dream a reality.
Creating your master list of start up costs

Your start up costs are often one-time or irregular expenses you incur to get your business up and running. Creating a master list of the cost categories is a good place to start. Once you have a comprehensive list, you can then start digging into each to figure out an estimated range of dollars you expect for your unique situation.

Physical location

Will you be opening a physical warehouse, retail location or office space? What will you need to furnish it on day one. Is there insurance or additional safety items you will need? Even if working from a home, there are often many office set up items you will need.

Web and online digital presence

Pretty much all companies are expected to have a website now. Will you build one yourself or hire someone to do this. Include costs like domain names, ongoing website hosting and any merchant fees you may be charged to accept payments online.


This is what you will actually be selling. Will you need raw materials, equipment to make your product or purchase items from others to resell. If you are selling services (like your time), what might you need day-to-day?

People costs

Are you planning to hire staff, contractors, a virtual assistant or intending to operate as a solopreneur. Is there any WCB or similar employment programs you will need for your people.


Any plans for digital marketing or need help creating brochures and sales material to assist with your company launch. Many companies end up spending considerable time and money on social media and other marketing channel so be sure to allocate some planned costs for getting the word out about your new business.

Mistakes to avoid when planning for start up costs

When you are coming up with your individual list of costs, be sure to compare it with this listing of 14 commonly forgotten items that new business owners often forget when planning for start up costs.

  1. Bookkeeping help
  2. Advertising budget
  3. Ongoing website hosting fees
  4. Professional membership fees
  5. Safety supplies
  6. Bank fees
  7. Email software
  8. City permits
  9. Insurance
  10. Incorporation fees and annual return costs
  11. Office supplies
  12. Photography
  13. Damage deposits
  14. Increased vehicle use
Tips for estimating costs and evaluating your plan

Allow yourself plenty of time to estimate the costs

Use the web, your network and associations to estimate costs
Pro tip: Consider using ranges when you start estimating costs

Evaluating your plan is as important as building your plan. Here are four questions to ask yourself when it comes time to evaluate your plan

  • Is there a cheaper / faster / easier way to start my business?
  • How can I get resourceful and remember everything I already have?
  • Do I need everything all at once or can I prioritize some things for later?
  • Can I create a plan to get the funding I need to start up?

Finally, keep in mind that planning is an iterative loop
You will make your best guesses; test your plans in reality; refine your predictions and re-test

Good luck with your new business venture and be sure to reach out to Finance Learning Lab for all the resources you need to make accounting make sense.


This article and mini-course was created by Carolyn Scissons. Carolyn is the owner of Finance Learning Lab. She holds a CPA, CMA, PMP, CIA designations along with holding an MBA degree. You can reach her anytime at Carolyn@FinanceLearningLab.com and be sure to subscribe to the Finance Learning Lab YouTube channel.