How to account for all of your costs

Today we look at how to ensure your business plan has accounted for all the costs you may accrue before your start and as you develop your business.

Any start-up costs

These costs can be quite substantial depending on whether you are buying a business or developing a brand new business.

Here's a list of costs to gather.

You will find you will have variable and fixed costs in your business.

FIXED COSTS are those that do not change if you sell one more product or service item.

These are likely to be rent, rates etc.

These will be in your business whether you are having poor sales or booming sales.

Some fixed costs will increase if your volume of business develops past a certain point.

Calculate your fixed costs then you'll be able to later work out how many units of product or service you need to sell simply to BREAK EVEN.

Fixed costs will include:

VARIABLE COSTS are those that increase when you sell ONE MORE service or product.

For every business it will be the direct cost for the product or service they are selling.

This should be fairly easy to work out but will include some or all of the following:

Now you have all your costs together, I'll show you tomorrow how to put your financial statements together and what they mean.

Planning helps you understand your business. It can be frustrating when there are no customers about and you don't know why.

Planning helps you look at your own business and the businesses of others to get the best of everything.

All the best