As I stated in another post, most business failures happen because the business was undercapitalized from the beginning. Oftentimes people aren´t completely honest as they sit down to write out how much will be needed to cover the start-up and to hold the business afloat for the first six months or so, until a customer base has been established and the inflow (what is coming in from the customers) is, hopefully, more than the outflow (what you owe for business supplies and so forth).
A great business plan will help you figure out just how much you need to get your business off the ground (http://www.allbusiness.com/blog/WorkingMothers/11535/004472.html and http://www.allbusiness.com/blog/WorkingMothers/11535/004509.html) as will creating a spreadsheet in Excel or a similar program which will help you breakdown the costs.
Here are a few additional tips that will help as you begin to establish your business.
First, accept credit cards. This can increase sales, since most of your buyers will purchase your products or services with a credit card rather than by using cash or check.
Offer discounts to new customers. This can be a great way to attract new customers to your services or products.
Offer longtime or fast paying customers a discount. Rewarding these customers will most likely result in repeat business.
Limit the plastic. One of the biggest mistakes new business owners can make is using their credit card for all of the start up costs. Remember, if you don´t pay off that balance at the end of the month, you´re going to incur finance charges. You might get a great rate in the beginning, but after a while that great rate is going to go sky high; if you are stuck with a large balance on your card, you´re going to be paying double for those purchases in the end. Instead, use checks against your business account and charge only what you can pay off at the end of each month.
Be realistic. Another big mistake when opening a business is to underestimate the costs associated with the start up. You´ll need to figure out every single item necessary for the opening of your business. This includes small items such as business cards and stationary, to large items, such as turning on utilities, renting a space, and designing a website. If you are selling a product, you´ll need to purchase packing materials. If you are shipping products, you´ll need boxes. Advertising is another necessary cost, and it can add up quite quickly depending upon the vehicle(s) in which you choose to advertise.
Shop around. You don´t need a vendor that lives next door. Many offer online shopping and shipping for free. I´ve found printing services and shipping boxes with vendors who lives almost a thousand miles away. They are much cheaper than purchasing these supplies from someone in my own neighborhood, even with the shipping costs added in.