Running a successful small business means being prepared. Even though many business owners think they’ve accounted for all major expenses associated with running their companies, they often come to realize there are hidden costs they’ve missed when it comes time to pay the bills. Although there’s no escaping certain costs like rent, employee salaries or taxes, small-business owners like yourself must be aware of other expenses and hidden costs that can take bites from your profits. With a bit of clever planning and the right tools, you can be prepared and keep operational costs down.
Predictably, heating, cooling and electrical costs represent a big chunk of operating budgets, even for the smallest of businesses. While you can’t avoid using utilities like electricity, you can monitor your use to make smarter decisions about when and how you use them. With a ComEd smart meter, you have access to more information about your energy use through personalized, online energy-management tools. You can enroll to receive phone, text or email alerts when your use is trending higher than normal for your business. You can also sign up for weekly emails that summarize your daily use.
Property insurance, employer and public liability, negligence, disability and employee health insurance are just a few of the insurance types you’ll require to protect your business. Read terms and conditions carefully to ensure you have the customized riders appropriate to your situation, from a fleet of vehicles to earthquake cover. Review and re-negotiate annually. It’s often possible to save money by locking in a discount when using one insurer for all your needs.
Beyond salaries, the costs associated with staff involve personal and medical leave, workers’ compensation, payroll taxes, benefits, health insurance, office space, recruitment and training. For each employee, you should budget for about one-fifth of basic salary in additional costs, according to compensation experts. Hire smart, as the hidden cost of recruitment far exceeds the investment in keeping happy, productive people on your team.
A consideration high on the list of unexpected expense items for small businesses, legal embroilments can occur at any time. In addition to legal fees and advice, there are the costs of potential settlements, higher insurance premiums, and time lost in running your business as a result. Even without a legal entanglement, remember the costs associated with initial set-up of your legal structure: LLC, incorporation, licenses, trademarks, copyrights, software, intellectual property, patents, non-disclosure agreements, hiring agreements, and ongoing consulting.
The miscellany of administration makes for a long list of items, tasks and duties often overlooked by small-business owners. Hidden costs can include smaller items like office supplies, credit card fees, shipping and postage, mobile phone charges, and broadband service as well as larger items such as computers, printers, furniture, equipment repairs, and website design. Don’t overlook ongoing maintenance, upgrades, repairs and replacement costs — it all adds up.
Want to learn more about how smart meter-enabled tools and services can save money? Contact ComEd at 866-368-8326 or visit ComEd.com/BizSmartMeter.
For more tips and inspiration for small business owners, visit Small Business Pulse Chicago.