When a baby is born there are many expenses which are incurred and majority of them are of one-time nature that is they are not needed again, in the same way when a business is started it can be compared to newborn baby and there are many expenses which are incurred for one time only and they are called startup costs. Startup costs refers to those costs which are required for starting a business, in order to understand it better let’s look at some of the examples of startup cost –
Startup Cost Examples
Fixed Asset Expenses
When an individual purchase fixed asset like land, building for starting a business or take these fixed assets on lease or make new furniture for starting a showroom or shop and so on can be considered as startup costs.
Inauguration expenses like refreshments for the public on first day or expenditure on the tent, expenses on the welcome gate and other such expenses also come under startup cost.
Registration expenses, legal fees, and other such expenses which are required for starting a business will also come under startup cost category as these expenses are incurred one time only.
First-time advertisements cost like giving news in local newspapers, distributing pamphlets, putting hoarding all over the city, online promotions through social media and other such expenses are also considered as startup costs.
Employee Training and Development
All expenses related to employee training and development which is required when the business is first launched is also a part of startup cost.
As one can see from the above that startup cost involves all the expenses right from the day on which the idea of business came into the mind of an individual until the day on which the inauguration of business takes place.