Over the weekend I got an email from one of my readers of the 3 Weeks to Startup book. I like to hear from readers, it makes an author proud. And this reader had some questions worth answering in a general way. So I’m posting my answers here.
The first question is about startup costs: Is there a master list I could preview to make sure I’ve covered all of my start up expenses and assets? (Do I need to put “rent” down in this start-up expense column? Is this detectable?)
The idea that there are master lists somewhere is so common that I’m delighted to take this chance to strike it down (again). No, it doesn’t work that way, at least not unless you’re involved with a formula-and-instructions business like a franchise (which, by the way, is why some people prefer starting a business with a franchise; but that costs a lot more money). So, unless you’re in a franchise business, don’t waste your time looking for that master list for your type of business. Businesses are all different.
Think about why this is true. My reader asks about a jewelry business specifically, but could there possibly be just one list for jewelry businesses? How many different jewelry businesses are there? Doesn’t each one have its own strategy, resources, and preferences? One will need to repave the parking lot, another will have to buy an engraving machine, a third will need vaults. There’s no standard.
Regarding rent, the rent that you pay before you start the business is part of your startup expenses. How much that actually is depends on your specific situation. Some people will start paying rent six months before they start selling to customers, either because they rent the place and then hit snags and delays, or maybe because they need to renovate and fix it up. Others will rent the place just days before they start. For more on this, you could go to the startup explanation in my online (free online) book site at planasyougo.com.
For examples, you can consult the 500 complete sample business plans you can read for free at www.bplans.com. Do the keyword search for jewelry there and you’ll see three of them are about jewelry businesses.
But please be careful not to get the wrong idea. Those are sample business plans developed for real businesses in specific markets, some time in the past, each with their own resources, team, and strategies. Use them as examples. Don’t copy them. Your business plan should be your own plan. It doesn’t come from the Web.
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