Prior to starting a business, most people typically spend countless hours reading articles about what they should expect and how to plan for success. Even with all of this helpful advice, it’s still common to be faced with many unexpected costs that will often takeyou by surprise.
If you’re in the process of starting a business, or even if you’ve already started one, it’s important to have a budget for the unexpected. Here are a few tips on how to do just that.
- Have an emergency fund
This may seem like common sense, but it’s important to have an emergency fund for your business – you’d be surprised how many early business owners neglect to do this. An emergency fund will help you cover unexpected costs, such as major repairs, equipment failures, an office fitout cost or unplanned marketing expenses. It’s recommended that you set aside at least 3-6 months’ worth of living expenses so that you can focus on your business without worrying about how you’ll pay your personal bills.
- Get insurance
Another way to protect your business from unexpected costs is to get insurance. There are many different types of insurance policies available, so make sure to do your research and find one that’s right for your business. Some common types of insurance for businesses include property damage, liability, and product liability.
- Have a Plan B
No matter how well you plan, there will always be some uncertainty when starting a business. That’s why it’s important to have a Plan B in place in case things don’t go according to plan. For example, if you’re planning on selling products online, make sure you have a brick-and-mortar store set up as well so that you can still sell your products even if your website crashes (or vice versa). Of course, this is just one example of how having a backup plan can ensure you avoid unexpected costs and keep your business running smoothly.
Ready to get started?
Starting a business is a huge undertaking that comes with a lot of risks. One way to mitigate these risks is by budgeting for the unexpected. By having an emergency fund, getting insurance, and having a backup plan, you can protect your business from potential financial ruin. So take the time to plan ahead and budget for the unexpected – it could save your business down the road!
