Like this article? PLEASE +1 it! Evan Signature
Evan Carmichael Top Header about About Home Profiles articles Tools forums inspirational quotes About facebook Twitter YouTube Blog
Share for a Cause











Beware Of Hidden Costs In Your Small Business

Guest post by: Maryjean Howe

Article Overview: Obvious costs are usually planned for. However, hidden costs will drain your money and time without your knowledge. These costs in fact are not hidden, but get overlooked when you factor in the major expenses. If you are aware of the hidden costs, you can avoid unpleasant surprises. Besides, small business costs can be reduced to a certain extent by managing the hidden costs.

Free Download - Tips to Overcome Network Marketing Failure By Maryjean Howe
Name: Email:

Beware Of Hidden Costs In Your Small Business

Obvious costs are usually planned for. However, hidden costs will drain your money and time without your knowledge. These costs in fact are not hidden, but get overlooked when you factor in the major expenses. If you are aware of the hidden costs, you can avoid unpleasant surprises. Besides, small business costs can be reduced to a certain extent by managing the hidden costs. In the excitement to get the business started, many small business owners forget about the business licenses. Business licenses and permits are required to start and run a business. You have to register your company name as well. If you want to register a brand name or trademark, things get more complicated.

Licensing requirements for a small business vary according to the type of business and its location. Although minimal, costs of getting business licenses are mostly overlooked. However, ignoring the required business license and permits will cost you more in future.

Another hidden cost in a small business is taxes. While great care is taken to pay regular income tax, other applicable taxes such as self-employment tax, payroll tax, and FICA tax that includes Social Security and Medicare taxes, are often ignored. Again, these will later come up as unexpected costs and attract penalty as well.

When you raise a loan for your small business, you may not notice the hidden costs that come along with the loan. You may be so engrossed in getting the money that you won't realize how much you are spending to get that money. If you take a closer look, you may even find the loan quite expensive. Processing fees, documentation fees, third-party fees, government fees, and other similar expenses, fall into the category of hidden fees. However, these will be clearly stated in the contract. Read the contract carefully and clarify any clause that you do not understand. Fees directly charged by the lender are often negotiable. Additionally, you should be aware of the other costs, such as pre-payment penalties and refinancing charges. Small business costs can shoot up significantly just because of these hidden charges in a bank loan.

Insurance is another component that increases small business costs. However, insurance will prevent you from shelling out cash from your pocket in case of an unfortunate event. It is mandatory to purchase business property insurance, liability insurance, and unemployment insurance. It is advisable to buy a health insurance package for your employees.

A small business owner faces a lot of difficulties in dealing with banks, licensing authorities, and other organizations that fall in this category. Ignorance can be costly in these cases. This makes the services of a legal professional essential. This is another factor that needs to be considered as hidden cost in your business.

When you consider costs, many a time, a small business owner will not consider the cost of time spend on various activities. Spending more time on any activity increases the costs associated with it, though not tangible. Moreover, you need to consider the time you spend away from the family when you try hard to grow your business, which also has a cost attached to it.

As a small business owner, it is important to be aware of these hidden costs in your business. Apart from including these costs to your estimated capital requirements, you can also try to price your products or services after factoring in these costs.

Related Articles
  Total Cost of Ownership TCO of IT
  Your Self Employed Hidden Paycheck – How to Pay Yourself More with Less (Part 1)
  How to Access the Hidden Market in Your Job Search
  Buying a Business
  Buying a Business FAQs
  Choosing a Business
  Nine Hidden Buyer Questions
  Turnover, what does it cost?
  Work with Distressed or Failing Businesses
  Remain Open to Learning and New Ideas
  Winning the Ohio Lottery or Obtaining a Business Loan What is harder
  Find Your Hidden Wealth
  Here’s How To Attain Your Dream Career
  Uncover Your Hidden Markets
  Virtualization: A Small Business Perspective
  Discover Your Team’s Weaknesses
  No Guarantees
  Buying a Franchise
  A Free Online Home Business
  Marketing - Fun and Toys

Home > Home-Based-Business > Maryjean Howe > Beware Of Hidden Costs In Your Small Business >
Article Tags: small business, small business costs, small business expenses, small business owner

About the Author: Maryjean Howe
RSS for Maryjean's articles - Visit Maryjean's website

 

Maryjean Howe is a professional internet marketer and business coach based out of Oceanside, CA.  She works with people all over the world to help them start a business and continues to help them use training materials to effectively run a successful business.  Maryjean has worked with people from all different backgrounds to help them start a business and run it successfully.

For more information and to contact Maryjean, visit: MaryjeanAHowe.com.



Click here to visit Maryjean's website
Dashed Line

More from Maryjean Howe
Why An Internet Marketing Business for Entrepreneurs Makes
A Home Business Can Have Tremendous Tax Savings
Tips For Creating an Internet Marketing Business for Entrepreneurs
The Best Ways to Get Free Leads For Your Home Business
The Importance Of Keyword Research When Marketing Online


Related Forum Posts
My entry My entry - 1. The Best Business Books Ever: The 100 Most Influential Business Books You'll Never Have Time to Read - this is a fascinating book about the history of Business theory, and I'd recommend it to anybody. 2. The Big Book of Small Business: You Don't Have to Run Your Business by the Seat of Your Pants, by Tom Gegax. Ditto. 3. PADI: The Business of Diving Book Okay, so this book won't be of use to anyone who doesn't want to start a scuba store, but I did, and this book was of course invaluable to me in reaching that goal.
These maybe the coldest franchises out there: These maybe the coldest franchises out there: - Here are the worst 15 performing franchises in regards to having the highest Small Business Administration (SBA) loan failure rates. The list is dotted with sub sandwich shops, fitness centers and car shops. WORST FRANCHISE LOAN FAILURES Failure % 1 OBEE'S SOUP SALAD SUBS 55.56% 2 LADY OF AMERICA 41.94% 3 COUNTRY CLUTTER (BED & BREAKFAST) 41.18% 4 COPY CLUB 36.36% 5 ALL TUNE AND LUBE 35.71% 6 PICKERMAN'S 35.71% 7 PHILLY CONNECTION 35.59% 8 ROLY POLY ROLLED SANDWICHES 34.78% 9 COTTMAN TRANSMISSION 34.48% 10 HAIR COLOR EXPRESS 33.33% 11 LEE MYLES AUTOMOTIVE TRANSMISSIONS 33.33% 12 GODFATHER'S PIZZA 33.33% 13 SMOOTHIE FACTORY 33.33% 14 BLIMPIE 31.39% 15 GOLF U.S.A. (RETAIL GOLF EQUIP.) 30.77% Source: Small Business Administration, SBA Loan Performance Within Franchise Code for the Period of FY 2001 - 2005
Exclusive: Interview with Results Exclusive: Interview with Results - Hi Forum Members, I'm helping start up a Business Coaching and Consulting company here in Toronto, Ontario, Canada (a Subsidiary of RSC Business in Los Angeles). As a Research and Development Intern I am required to practice my listening and interview skills by surveying Small and Medium Businesses on thier Business. This Survey is designed by RSC Business to also assist the Business being interviewed more insight into their own business. I am looking to interview about 30 businesses across North America over the span of 3 months. At the end of these interviews I will be publishing a report of the results and they will be made available for free to the Interviewees. The Report data will include responses from a minimum of 100 interviews. I would like to extend this opportunity to members of the Forum. If you would like to have this short 20-30 minute interview conducted on your Business and you reside in North America please send me an email or PM. Please contact me at andy[at]jvprosperity[dot]com to arrange our interview and to get free access to the results when they are published.
Re: Biz Plan Competition Re: Biz Plan Competition - i just wanted to say that posting Small Business Events on CanadaOne is a great resource. Thanks Julie!
New Small Business Topic New Small Business Topic - Hello everyone, I'm on the lookout for new topics to add to my site. We just launched a Franchising section and are planning Human Resources section. Do you have any thoughts for a new section? Here's a list of what we currently have: Angel Investors Branding Bank Loans Business Coaching Business Plan Franchises (New) Insurance Legal Marketing Public Relations Sales Small Biz Loans Venture Capital


Recommended Article for You close

  Total Cost of Ownership TCO of IT

Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.



Featured Article

Bottom Footer



Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!
Name:
Email:
Popular Articles

Having It All... With No Sleep

How Promotional Caps became a Fashion Trend

Small Business Internet Marketing

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.