Cost of doing business

There are a lot of "little" things that may surprise you in the cost of doing business.

Experience is a hard teacher. After you go broke, you may realize that you did not charge enough money.

An old saying is that "A company never goes broke by charging too much."

That is a nice saying, but sometimes the customer will not pay that "too much."

So, you have to charge enough to stay in business, but not so much that everyone else will get into the same business.

You will need some reserve cash for those unexpected "little" things. That is sometimes hard to do, when there are pressing expenses that need to be paid.

Sometimes it is better if the person that pays the bills does not set the prices to sell. If he knows that the rent, lights, etc are due, he may cut the selling price to make sure of the sale.

Add up all of the expenses and divide by the number of work days

to get a cost per day. A small office may cost $800 dollars a day just to open the doors.

rent,

lights,

water,

insurance,

office expenses - paper, tape, ink

phones

magazines, training data, info

computers

salaries

holidays

vacation time

sick leave

taxes - income, SS, workmanscomp, liability

advertising

Often a person that owns the business makes less per hour than a paid employee.

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