As defined by Merriam-Webster, “start-up” is the act or instance of setting in operation or motion. Although most individuals associate start-ups with technology companies, it’s important to understand that start-ups are simply newly-founded companies — those recently set into motion or operation. For example, Carnegie Steel (predecessor to U.S. Steel) was a start-up when Andrew Carnegie began the process of constructing his first steel mill in Braddock, Pennsylvania in 1872.
For entrepreneurs, starting a new business is an exciting time. It’s a period of giving life to an idea and for those without prior experience in starting a company, the process can seem daunting. As the idea is the core of any start-up, proper budgeting is often overlooked. When budgeting a start-up, the following start-up costs must be considered.
For many entrepreneurs, legal fees are often seen to be a waste because they can access many basic documents online. For many, choosing to use these basic documents will result in costly contractual disputes, potential personal liability for the founder, and drawn out partnership disputes, among other exorbitant costs. Consulting with a Georgia business attorney who understands the specific needs of your business can save you both money and time as your start-up grows.
When considering an attorney, one should consider an attorney with experience in guiding startups through the many issues that are out there, which could help avoid common mistakes that cause many startups to fail. The right attorney or legal team, such as attorneys at Klosinski Overstreet, will be able to guide a start-up with many aspects (not just the drafting of documents) due to years of experience, as there are many considerations and pitfalls to avoid.
Although many business founders realize the need to hire employees, the total cost of employment is often underestimated. In addition to direct wages, employee benefits and tax consequences must be considered. Underestimating employee costs can add thousands in unplanned costs to your bottom line and jeopardize your budget.
Although most types of business insurance are optional, property and casualty insurance should be considered a necessity for certain types of businesses. Casualty insurance varies in coverage and can insure against unexpected expenses relating to employee injuries, product liability, and other unforeseen catastrophic expenses relating to the business.
Although marketing is dependent upon the product or service being offered, marketing costs should always be estimated and included in start-up costs. For some businesses, buying an advertising spot in the local paper may be sufficient, while others may require more expensive and sophisticated plans such as employing a social media advertiser or a company to conduct a mass mail-out campaign.
Regulatory costs are dependent upon your business, but should always be carefully considered. For some businesses, these may include a special license to conduct specific activity in the state. For others, ongoing costs such as compliance certificates for meeting environmental regulations may be required. Ultimately, regulatory costs should be explored in tandem with a legal or industry professional.
Business and Start-up Lawyers Serving Augusta, Georgia
At Klosinski Overstreet, we have protected the interests of hundreds of entrepreneurs, start-ups, and established businesses by providing superior legal counsel. Whether advising on corporate entity choice, drafting corporate documents, or identifying potential liability exposures, our attorneys use their years of experience to provide outstanding legal service. If you have questions pertaining to your business or start-up idea, please contact our office today to schedule a consultation.
Posted in: Business Law