12+ Free Business Startup Costs Templates [Word | Excel]

A key challenge to many entrepreneurs is forecasting and managing the costs of their startups. A good way to overcome such a hurdle is using a Business Startup Costs Budget, which is a document that provides a list of all anticipated expenses that will be incurred when starting a business and how to raise the capital to meet them.

The business startup costs template constitutes an essential element of the business plan that will guide your financial decisions, such as raising funds and projecting profits.

Although starting a business is quite exciting, there is more to a business than employing people and furnishing an office space. Nowadays, business startup costs are quite huge since entrepreneurs have to purchase software, equipment, appoint employees, and sign leases. These are just the basic costs since they also have to host a website, make business cards, and acquire licenses and permits, among others. Most entrepreneurs, however, overlook startup costs and start their business in an unplanned manner. Although this may work, it is usually more challenging.

Free Business Startup Costs Templates

As a new business owner, you should never underestimate the expenses of the new venture. To help you capture all startup costs, you can make a business startup costs template. The following businesses can significantly gain help from the startup costs budget template.

  • Restaurant business
  • Home-based business
  • Online businesses
  • Franchise business


Restaurant Business

Opening up a new restaurant may be a daunting venture mainly due to the costs involved. However, with a clear understanding of every aspect of the restaurant’s opening costs, one can make intelligent decisions. Even though restaurateurs may have diverse experiences when setting up their businesses, certain expenses are common across the board.

For example,

Every new restaurant will purchase kitchen equipment, make payments for the business location, finishes, technology, marketing, employee costs and related fees, premiums, and bills. Using a startup cost budget enables you to have a good estimate of all these costs.

Download: Microsoft Word (.docx)


Home-based business

One key advantage of home-based businesses is that one can forego some startup costs, such as the cost of purchasing furniture, internet, and office space that are already available at home. Nevertheless, it is still invaluable to create a business costs budget to ensure that all other expenditures are realistic.

Download: Microsoft Word (.docx)


Online businesses

Operating an online business may be considered less costly compared to running a brick-and-mortar store. The startup cost is even much lower if you can perform web development services without outsourcing. It may be vital to make a costs budget to ensure that all expenses have been accounted for.

For example,

Entrepreneurs in online businesses should include costs related to web development, digital marketing, web, hosting, among others in their budget.

Download: Microsoft Word (.docx)


Franchise Business

If you are looking for a franchise opportunity, this budget template may also be beneficial. Even for this type of business where the brand and business model are already laid out for you, it may be crucial to be clear on all the possible expenses. The template provides the regular startup costs and the upfront franchise fees. It may also be important to check with the franchisor, who may offer tools to project the startup and operating costs.

Download: Microsoft Word (.docx)

    Types of Business Startup Costs

    All startups are different from each other, and hence the business startup costs vary depending on the business type. Some of the many types of business startup costs are the following:

    Incorporation fees

    When launching a new business, deciding whether the entity will be either be a sole proprietorship, a partnership, or a limited company is essential. The various business entities have distinct legal and financial implications.

    For instance:

    Individuals looking forward to registering a company may pay a fee of up to $725 for filing their articles of organization and incorporation.

    Licensing fees, permits, and incorporation fees will apply depending on the type of business, industry, and location.

    For instance:

    Some jurisdictions require payment for licenses when operating in some industries such as aviation, food processing, among others. Some retail outlets will also need to pay for registration or permits in order to operate.

    Research expenses

    The secret of running any successful business is conducting careful and thorough research to understand the prospective industry. Some businesses may decide to hire a market research firm to gather important information about the business. The expenses of hiring research experts must be included in the budget.


    When starting a new business, some equipment and basic supplies must be purchased to meet business needs. It is paramount to decide whether to buy or lease the equipment depending on your financial position and the available options. Equipment costs may vary depending on the type and size of the business. If the business cannot operate without such assets, it is crucial to account for them in the startup budget.

    For example:

    If your new construction business needs a concrete mixer machine, include its estimated cost in your budget.

    Office space

    Many small businesses with limited capital begin from the homes of their founders in order to reduce costs. For those that have fairly significant amounts of money, the business owner may decide to lease or buy the premises. However, it is important to state that the entrepreneur will also have to pay for other costs such as purchasing furniture, installing office fittings, paying for utilities, among others. Due to such expenses, many small businesses will choose to rent an office or use a co-working space that can be accessed using various apps. Obtaining a suitable business premise is often a top priority for new business owners because a good location can help the business to get recognition and thrive faster. The cost of office space is often dependent on the location. For startups with low budgets, co-working space is a good area to start as it comes fully fitted and ready to use. Business owners in the service industry can also operate their new startups as virtual offices that do not require a physical office. In most cases, the proprietors will travel to meet clients in their own premises or in agreed locations.


    For startups in the manufacturing, restaurant, retail, wholesale, and distribution sector, purchasing initial inventory for ongoing operations and resale is a basic necessity. You must carefully estimate the required inventory to ensure that it is enough to operate the business effectively. Inventory management is a complicated affair that can have serious repercussions if not well handled.

    For example:

    A business risks having dead stock or outdated items if excess inventory is purchased. On the other hand, if the inventory is too low, the business will experience stockouts, which means that customers will have to look for the goods they needed elsewhere. Being able to determine the optimal amount of inventory that will just be enough for the business is very important.


    Once you have set up your business, the next step is spreading the word to your target market. Advertising and promotion will be necessary early in the business life cycle and in the subsequent stages to build trust with the public and boost brand visibility. Related advertising costs may include print ads, business cards, brochures, and online advertising.


    The contemporary business scene has evidenced rapid technological advances whereby owning a website is a key competitive tool.  An online presence will ensure that potential customers interact with your brand. Using a variety of freely available content management systems and free website builders, you can easily create a professional-looking website at a low cost.

    Office supplies

    All businesses will require office supplies such as office desks, computers, and office phones to operate effectively. The total sum mainly depends on the tools specific to your business and the total number of employees. However, business experts recommend that office supplies and furniture should not exceed 10% of the total budget.


    Common costs for brick-and-mortar businesses include internet, electricity, water, and phone bills that are paid along with the fixed costs of operating a business. These costs are both startup and ongoing business expenses.


    The cost of human capital includes salaries, wages, bonuses, stipends, and employee benefits. These costs must be paid even in the early stages of the business life cycle when less revenue is generated.

    Professional consultants

    To eliminate costly mistakes in business, it is paramount to work with experts and professionals who understand the field better.

    For instance:

    A company will be able to handle the tax filing requirements of their business or company by employing the services of a certified public accountant.

    The accountant can also help businesses in determining their tax liability when operating in the various legal structures, selecting the most appropriate workers’ compensation procedures, and advise on how to perform your employer duties. When filing your taxes, the accountant will also help you in preparation, which may reduce your tax obligations significantly.

    Keep in mind that you can always outsource tasks to such professionals without hiring them in order to save on costs. You can do some of the simple tasks in accounting such as bookkeeping, and only invite the accountant after a period of time to handle the more complicated aspects of accounting. Small business owners can also ensure they are conversant with relevant business laws, and only consult attorneys when it is very necessary. Liaising with an attorney can help to avoid costly litigations that are related to copyright infringement, or even assist in preparing contracts with your business associates.

    Professionals charge differently depending on the field, such as law, accounting, IT, etc. By handling some of the minor tasks yourself, you can save a lot of money that would have been paid to the consultants. You need to ensure that only complicated projects should be outsourced to save on costs.


    Business insurance is important to protect personal assets from business-related legal liabilities. Insurance also covers workers and business assets, and it can be an annual or a monthly cost.

    There are four common forms of insurance that businesses can choose from:

    • The general liability insurance covers the business owner and property against injuries or damage respectively.
    • Commercial property insurance covers the tangible assets of the business from perils such as storms, fire, or theft.
    • Workers’ compensation insurance helps you to avoid costly liability claims in case of injury to employees during the course of their work.
    • Errors and ommissions insurance protects the business against losses related to undelivered services or business mistakes, for which the client incurred a loss.

    It is important to mention that the rates charged for the various types of insurance depend on the factors such as the nature of the business, location, business size, environmental hazards, legal history, among others.


    The total amount of taxes to be paid mainly depends on the business revenue, the business entity, and the deductible expenses. Therefore, it may be important to work with a CPA to ascertain deductibles and save on tax fees.


    Although travel costs are essential to consider, not all business owners have to factor this cost into the budget. You can avoid frequent travel in order to minimize transportation costs and allocate such funds to more important cost items, such as utilities or rent. Another strategy is to use travel business cards when making official trips since they are able to gather loyalty points and reduce future fares. For those people whose businesses require a lot of trips, you may choose to travel in the economy class once in a while to lower your costs.


    Shipping costs are variable costs that only apply to businesses in the retail sector. These costs may include the cost of packing materials and postage. Shipping services can reduce the burden related to shipping costs, particularly for small businesses. These services also allow you to print postage without the need to purchase expensive postage meters. You can also obtain affordable shipping boxes from various shipping services.

    Business Startup Costs Templates

    The most critical step for you when opening a new business is to design a business startup costs template. The template is important as it enables you to project the cost of your operations and compare the costs with the available resources. As a result, you are able to rationalize operational expenses. Before using a startup business plan template, you must create a budget. For a new business enterprise where no previous information is available, you can conduct research or contact other business owners who can provide you with budget estimates.

    To calculate the business startup costs, our free business startup costs templates would be of much help. The worksheet outlines advertising and supplies costs, facilities costs, equipment costs, and other business start-up costs. Consolidating costs and ensuring their feasibility is usually the most challenging part. Most entrepreneurs tend to underestimate start-up expenses, exposing the business to the danger of being underfunded. Hence, for the business to run smoothly, overestimated costs are better than overestimated revenues.

    To build a business startup cost worksheet, you need to format a page spreadsheet application such as Excel. For all start-up expenses, create a worksheet or page in the spreadsheet software. The costs should be on the right while items should be on the left, and each section should have totaled. The business startup cost is the summation of the sections’ totals, including advertising and supplies costs, equipment costs, and facilities costs.

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      How to Create Your Business Startup Costs Budget

      Creating a costs budget for your startup is a simple procedure that guarantees you a successful business launch. The following tips may help guide the process:

      Plan your first day

      Your first day when you open the business should be well mapped out by preparing a budget of all the cost items needed to launch the business. A budget for this day should account for all expenditures including the facilities cost, capital expenditures, supplies, and fees.  Facilities cost may include the cost to purchase the space, security deposits for lease, etc. Capital expenditures include costs incurred to purchase fixed assets such as furniture, vehicles, equipment, etc. Other vital costs such as attorney fees and accounting fees should not be excluded from the budget template.

      Make a list of your funding sources

      Only a tiny percentage of small business owners manage to finance the entire business without sourcing finances externally. Therefore, it is paramount to outline all the sources of funds, including loans, savings, investment income, and credit cards, to determine where all the money will come from.

      Enter variable and fixed costs

      It is important to categorize your costs into one-time costs and variable costs. Variable costs mainly fluctuate with the sales and production and may include utilities, raw materials, shipping costs, etc. One-time costs include the cost of furniture and fees.  Fixed costs are basically the costs that do not change irrespective of how good or bad your business is. Variable costs on the other hand are those that vary with a change in the business performance.

      Estimate monthly sales

      This step is very critical during your budgeting process. Mapping out your sales and profitability in the profit and loss statement guides your strategy. Be very realistic when making these projections to understand your business and the amount of money you need to continue operating. However, it is worth noting that this is a difficult process as you are not aware of the sales that your business will generate. To simplify your work, you can perform three sales estimates:

      • Most optimistic forecast- This is the highest amount of sales that you can possibly make within a year.
      • Worst forecasted situation- This is the least amount of sales that you expect to make within a year.
      • Most likely situation- This is an average of the total sales that will be made in the year, which is used to guide any financing decisions to be made.

      The three cash estimates can be used to create your cash balance, which subsequently assists you to determine how much additional funds are needed from internal and external sources.

      Small business owners should be practical and realistic when making sales estimates.

      For instance:

      It would be safe to predict that not every sale will be realized. The total sales realized will mostly depend on the nature of the business, as well as the payment method by clients.

      Perform calculations

      People often underestimate the importance of analyzing the budget to determine the deficit or surplus. This information helps to ascertain expenditures that are not a must for inclusion in the budget. It is important to sum your estimated figures in the business startup budget template in order to establish if you have a deficit or a surplus. A deficit means that your costs need to be minimized and you may have to get more finances for the new business. A surplus implies that the business can proceed without funding hitches.

      Create your cash flow statement

      A cash flow statement is important for your business as it helps you trace all the cash and cash equivalents that enter and leave the company. You can also use downloadable online templates to do the calculations. You can calculate the cash flow by combining the monthly total sales, total collections, and total costs.

      Keep things in check

      As the final step, it is crucial to give budgeting the attention it requires by involving everybody in your team and ensuring that all key components have been taken into account. Changes can also be made where necessary and as the need arises. It is also important to keep things in check to avoid over-spending. The template allows you to create a budget and determine the actual costs of various startup items.

      How to Save on Startup Costs

      If not well managed, the startup cost for a business can be overwhelming. However, some costs are worth investment, particularly in purchasing equipment and fittings and designing the business website. If you feel overwhelmed by the startup costs, there are various avenues where you can obtain finances for your investment

      Secure funding

      Initial funds for your business can come from either debt and equity financing. However, debt financing options are relatively hard to obtain for new businesses. Instead, you can work with venture capitalists who are willing to fund seed-stage businesses.

      Get a business credit card

      It is essential to apply for a business credit card that qualifies for a higher credit limit compared to a personal card. In addition, a business card is important as it enables you to separate business and personal expenditures.

      Hunt for bargains

      It should be your key priority to reduce unnecessary expenditure as much as you can.

      For instance:

      Using accounting software can save you significant costs compared to hiring a professional bookkeeper.

      In addition, advertising on social media that is free may save the business substantial advertising costs.

      Frequently Asked Questions

      What is the average cost to start a small business?

      There is no specific amount attached to starting a business. The average cost is dependent on the size of the business, business type, and industry. Therefore, the average cost varies from business to business.

      How do you calculate startup costs?

      The easiest and most efficient method of computing startup costs is by using a budget template. The template highlights all the startup costs and variable expenses. Business experts recommend covering business expenses for the next six months when revenues are minimal.

      Are business startup costs tax-deductible?

      The IRS does not acknowledge startup costs as capital expenditures. However, organizational costs worth $5000 incurred after October 22, 2004, can be deducted for businesses with startup costs of $50,000 or less.

      What is considered as startup cost?

      A startup cost is categorized as any expense incurred when setting up a new business. This may include office space, taxes, payroll, professional fees, insurance, etc.

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