The Hidden Costs in Business
One of the costs is licenses. You will only take a business license once. It is important in the business that you note down all the expenses no matter how minor they are. Licenses are always renewed after a given period of time maybe one year of which the business owners always don’t count it under expenses. Make sure that you note down the details of license renewal including the cost and date of renewal . This will help you in connecting with other business owners and this may help you in expanding your business.
Another expense is the cost of building space. You will need more space when your business grows. This will make you require more land for expanding your business. Apart from expansion, the building will also come with an increase in rent, utilities, and other local costs. You will also need to employ more manpower after expanding your business. These are some of the costs that the business owners assume. You should make sure that all this should be included in the paperwork for the purpose of knowing how the business is fairing.
Apart from that we also have recruitment cost. You find that they are always very expensive as it involves things like advertisement, potential outsourcing to an agency, and the cost of the time you spend interviewing the candidates, going through their credentials and offering training. All this should be put under your expenses.
In addition we have maintenance cost. We have a lot of things that require maintenance in your place of work like furniture, computer servicing and software update and other needs of your employees and your business. This is something that very few business owners remember to put down.
Another hidden cost is the tax. This is the responsibility of the revenue authority to make sure that any business owner pay tax for his business. Taxes often costs a lot of money since it is paid on a monthly basis. You will pay money depending on the size of your business. It is, therefore, necessary to include it under expenses since the money you are taking from your business.
Another expense is insurance cover. Most businesses have insurance covers that they pay on monthly basis. Therefore, you should include it under expense since it is taken from the business. But the business owners are doing the opposite.
In some cases you find that employees are being paid when they are leaving job. And this money is taken from the business. As a result most business owners don’t see as an expense since it is not part of their monthly pay.