5 Hidden Costs You’ll Discover When Opening An Office

When starting your own business and opening an office, there are a lot of costs involved. Most of them, you are probably well aware of. You are going to either be paying a mortgage or rent for the building that you are occupying. Another major cost will be payroll expenses. If you need large machinery or equipment, this will also be an expense that you are aware of.

However, there are a handful of costs that are somewhat hidden, or at least not at the top of mind of most business owners. These hidden costs will start to add up quickly.

5 Hidden Costs You'll Discover When Opening An Office
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Insurance Costs

Business owners are required to purchase insurance for a variety of different things. Even if this wasn’t a legal requirement, it’s in the best interest of every business owner to insure themselves. This can help protect you against insanely high costs in the future if something were to ever go south.

Business owners usually need to purchase property insurance, liability insurance, and unemployment insurance. All of these insurances can prevent disastrous financial events in your future and should give you some peace of mind that you have all of your bases covered. Another type of insurance you can purchase, but are not required to, is health insurance for employees. Some businesses provide this as an added bonus for employees so that they don’t have to pay for it out-of-pocket. Unfortunately for small businesses under ten employees, it is even more expensive.

Professional Fees

One of the first fees new businesses encounter is professional fees. These fees go to business professionals that ultimately help you setup your business. For example, you might hire an outside accountant to handle your books and tax returns. The fee that you pay your accountant would be considered a professional fee. The same goes for hiring a lawyer. While some business owners opt to file for their business structure themselves, it is wise to hire a lawyer to help you file this. The more complex your business, the greater the need for a lawyer who deals with business filings.

Office Cleaning

If you are renting from a commercial rental property, the cost of office cleaning might already be covered. This is not a guarantee so you should definitely be thorough when reading through your contract.

If you own your office building or are renting space from someone other than a commercial broker, you are going to need to hire professional office cleaners. A lot of new business owners are on a shoestring budget so wanting to avoid this cost is understandable. However, expecting your employees or yourself to do a thorough office cleaning simply won’t cut it. You can actually hurt your business if your office is unclean. Potential clients won’t want to visit if they are walking through a dirty, unorganized office. Employees won’t want to work in a filthy office either. Clutter can actually make employees less productive.

Administrative Costs

Administrative costs can typically fall under a handful of categories. You can almost consider this your “petty cash fund” because it is all of the small office supplies and tools that you will need to run your business.

The larger and more expensive subsection is routine maintenance and repairs. If you own your building, you will need to pay for miscellaneous maintenance for building related issues such as HVAC, electrical, and more. You also might want to stockpile some cash for unexpected repairs. While you should have purchased building insurance, you still need to cover additional expenses like the deductible.

Admin expenses can also include the small office supplies. Things that are flat our necessary such as toilet paper, plates, cups, staplers, pens, sticky notes, paper clips, and much more. Sure any one of those items is fairly inexpensive but after time, it will start to add up.

Utilities

Utilities are an unfortunate cost of owning a business. Many utility related costs will be unavoidable. Often times, you will need your own phone service, especially mobile, and your own internet service.

However, some of these costs can be avoidable if you check the fine print. If you own the building, you are pretty much guaranteed to pay all utilities. On the other hand, if you are renting, many commercial rental properties include some of the utilities such as water, heat, or A/C.

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