{"id":225234,"date":"2023-02-21T19:00:59","date_gmt":"2023-02-21T19:00:59","guid":{"rendered":"https:\/\/www.markperlbergcpa.com\/anticipating-first-year-expenses-when-opening-a-atlanta-business\/"},"modified":"2023-02-21T19:00:59","modified_gmt":"2023-02-21T19:00:59","slug":"anticipating-first-year-expenses-when-opening-a-atlanta-business","status":"publish","type":"post","link":"https:\/\/prosperlcpa.com\/blog\/2023\/02\/anticipating-first-year-expenses-when-opening-a-atlanta-business\/","title":{"rendered":"Anticipating First-Year Expenses When Opening a Atlanta Business"},"content":{"rendered":"
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It\u2019s February and love is in the air. (So are taxes. And Super Bowls.)<\/span><\/p>\n

Flowers and chocolates showed up on desks and countertops this week with sweet little romantic notes. Restaurants set those sweetheart menus for their in-love diners. And if you\u2019re one of the \u201clucky\u201d ones with heart eyes for that special someone, you might have spent $200 (or more) on your significant other <\/span>this year<\/u><\/span><\/a>. <\/span><\/p>\n

Being in love ain\u2019t cheap. <\/span><\/p>\n

And anyone who celebrated Valentine\u2019s Day knows that the same dozen roses you could have bought in January were almost double their price the second week of February. <\/span><\/p>\n

But if you\u2019re a newbie in the love department, you might not truly understand just how much you\u2019d have to shell out for that special someone. It\u2019s easy to get caught unawares by the expense of it all and find yourself paying it off over months.<\/span><\/p>\n

First-time owners have a similar experience starting a Atlanta business (oof\u2026 that segue). <\/span><\/p>\n

When you thought about opening a business, you knew it was gonna be costly, but just how much<\/i>? When you\u2019re new to the game, it\u2019s tough to fathom just how fast the money will go \u2013 let alone anticipate all of those first-year expenses. <\/span><\/p>\n

As someone who knows well and has advised many new business owners, I want to give a little insight on this topic today. So, you can be better prepared\u2026 or to pass it along to someone who\u2019s just now starting out.<\/span><\/p>\n

If you\u2019re preparing to launch a new business venture (or are already in the thick of it), let\u2019s get something on the calendar and look it over together. You\u2019ll never regret preparing your future self for success. <\/span>
calendly.com\/mark-perlberg-cpa<\/a> <\/strong><\/span><\/p>\n

Now, onto today\u2019s topic\u2026<\/span><\/p>\n

<\/span>Anticipating First-Year Expenses When Opening a Atlanta Business<\/strong><\/span><\/span>
\u201cExpectations is the place you must always go to before you get to where you’re going.\u201d – Norton Juster<\/i><\/span><\/p>\n

When you\u2019re opening a business, it isn\u2019t always clear how much money it takes to get started and keep it running for a year \u2014 but it is often underestimated. A <\/span>recent poll<\/u><\/span><\/a> of 700 small-business owners found that more than half of them lowballed what they\u2019d have to spend during their first year. <\/span><\/p>\n

That\u2019s a lot of miscalculation \u2014 and a lot of potential for having to shut the doors before you ever get off the ground. No wonder a third of small companies go out of business within two years. <\/span><\/p>\n

All that to say: It pays to know what you\u2019re getting into and how to survive those crucial first 12 months after opening a business. <\/strong><\/span><\/p>\n

Where <\/strong>does <\/strong><\/i>all the money go?<\/strong><\/span><\/p>\n

Surveys have shown that business owners drop from 35 to 100 grand in the first year, depending on whether their company is completely online or completely brick-and-mortar. <\/span><\/p>\n

Here\u2019s the breakdown: about a third for inventory, a fifth on equipment, 10% to 15% each on location and taxes, and a little under 10% each for utilities and payroll. Other common costs include insurance and marketing. New owners have said that surprise-heavy expenses have included taxes, technology, various fees, and (less of a surprise these days, for sure) shipping costs. <\/span><\/p>\n

Where\u2019s the money coming from for all that? Most sources are familiar: investors (such as venture capitalists and angel investors), crowdfunding, and borrowing from family or friends. The U.S. Chamber of Commerce claims that most startup \u201cseed rounds\u201d are around half a million to 2 million bucks. <\/span><\/p>\n

One troubling surprise for some brand-new Atlanta businesses is the lack of conventional funding. Commercial business loans can be hard to come by for completely new companies that have no proof of future revenue. Many owners turn to their own money in the form of their everyday savings, nest eggs, alternative lenders (such as peer-to-peer lending, with its risks), credit cards, or personal loans.<\/span> <\/strong><\/span><\/p>\n

Common mistakes<\/strong><\/span><\/p>\n

What goofs should you avoid when opening a business? <\/i><\/span><\/p>\n