5 Startup Costs That Startup Owners Should Never Skimp On

When you’re in the process of starting a business, whether it’s the online or brick-and-mortar variety, expenses resemble a tsunami of cash washing out the door. Some costs are avoidable. We’re talking about that 60-inch, 4k television you’ve had your eye on for the employee bathroom. Our advice? Skip it. Maybe later. But then there are other costs you absolutely should not skimp on. These are the ones that provide a mighty temptation to save a little money but could cost you dearly down the road.

#1 Pro Design Elements

The visual appearance of your website, logo, business cards, or signage is too important to leave in the hands of a well-intentioned but green-behind-the-ears nephew studying gaming design at the local community college and wants to make a few extra bucks for his energy drink habit. Not to slander the kid. He might have great chops, but we’re talking about the success and failure of your business here. Some people have an innate sense of design but this is not the place to test it out. There’s a vast difference between trained pro and amateur. As they say, you don’t get a second chance at a first impression.

#2 A Rock Solid Backup System

Rare (maybe nonexistent) is the startup that doesn’t rely on a computer or the internet to some extent. That means system crashes or hacker mischief will be a possible reality at some point. Did you know that close to 50% of all cyber attacks target startups and small businesses now? Consider everything you might eventually store on your website, computer, or in a database – customer details, work product, carefully designed sales funnels. Now imagine having to start all over from scratch because you decided to save ten bucks a month by not paying for a reliable cloud backup system.

#3 The Customer Service Solution

Customer service is important. Maybe even critical. No one has to tell you that but maybe you need a reminder that the goal should be to address every complaint immediately if not sooner. Gone are the days, if they ever existed, when a new business owner could tend to this task alone with nothing but a single phone line. Today’s plugged in and impatient customer expects to be able to reach a company representative by email, phone, and chat any time. Let’s say that louder. ANY time. Help-desk platforms as a service, like Freshdesk or Zendesk, start off as little as $16 per month and are your best bet for not letting small issues become larger ones.

#4 Good vs. Cheap Web Hosting

Web hosting is an industry famous for offering free or deeply-discounted service as low as a buck or two a month. Please resist the urge. These jokers are also famous for spamming, merciless upselling, packing way too many clients onto a shared server, and ridiculously slow page-loading times (courtesy of those packed servers). By shifting your budget from zero to even the $5-10 per month range, you’ll climb out of the gutter and give your website a legitimate shot at being worth a darn. Proper security and guaranteed server space cost money. Don’t be afraid to look into a dedicated or VPS (Virtual Private Server) either.

#5 Legal Advice

Nobody likes to talk to lawyers, and don’t take this to mean you should run out and put an international law firm on retainer at $5,000 a month, but it wouldn’t be a bad idea to cough up a few hours for consulting and basic forms and contracts to get your business on solid legal footing from the start. Should you incorporate or not? Form a partnership? These are questions with serious tax implications. Are you ready to defend yourself against copyright infringement claims? Small businesses have to fight off lawsuits related to that last one all the time. Don’t let legal problems crash and burn your startup before it ever gets, well, started.

Final Thoughts

Obviously, this is not the final, final word on startup costs you can’t afford to skimp on but these are some of the most critical areas to deal with immediately. Let’s slip an extra one in here – people. Employees are expensive and can be a hassle. They can also be the secret sauce that does the grunt work and allows you the freedom to spend more time growing your brilliant ideas at least one step removed from the daily grind of sales and customer service.

Oh yeah. And a good coffee machine. Good luck out there!

 

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