why do you need money to start a business
Basically there are two types of money when it comes to starting a business: the owner's and other people's. Many people think only in terms of out-of-pocket cash when accumulating money to start a business. The fact is, however, that credit cards can provide the money a person needs to cover his startup expenses. An individual may also seek business loans, request money from investors and apply for grants to fund his startup with other people's money.
For new entrepreneurs who only want to work with their own cash, however, saving a startup investment may be the answer.
Once youвve gotten to grips with the impact on your personal finances, itвs time to focus on how much it will cost to get your business up and running.
These tend to be bigger ticket items, including: permits, licenses or other compliance costs registering your intellectual property (IP), eg trade marks or patents. Note not all need to be registered. These are bills and other costs you need to pay on an ongoing basis, also known as overheads. These tend to be time-related, eg monthly phone bills or quarterly rates payments.
Common fixed costs include: utilities, eg electricity and internet wages/salaries. These are expenses that vary depending on how much, or how little, your business produces. stock orders. An accountant will be able to run through your projected expenses and pinpoint any others you might not have thought of.
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