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Costs to consider before starting up

So I have been scrouching the web for a while now for a quality info on what are the major cost factors that one must consider before startingUp..

Sadly I haven’t came around any good info and even which I found was not India Specific.. So I thot what better place to have this discussion than TheRodinhoods..

What do you think are the key unavoidable costs that must not be missed out while estimating cost for your startup..

This will help a lot of Non-MBA, Fresh outta college budding entrepreneurs.. 

So what are these factors and how much is it??

By far I have figured:

Office rent + monthly bills
Team’s Salary
Infra like PC, Internet etc..
Marketing costs.. 

I have estimated Office rent + bills to be around 12-15K per month
Salary varies person to person
Internet, PC and Laptop costs can be easily found out..
Good Server can cost you around 15K per year (for beginning)

What I have no idea about is the marketing costs.. what is the avg. marketing cost??
Maybe in terms of CPC, CPA , CPM etc.. And not just for E-Commerce but for non-ecommerce biz too..

Lets compile a good set of info here to help me and many like me.. 
Thanks in advance.


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  1. For an oven-fresh startup, i’d add:
    Web hosting – 5000 – 10000 per annum
    Legal (assuming incorporation) – 20000 fixed, 15000 per annum
    Payment gateway – 10000 fixed, 3000 p.a.

  2. And what about marketting??

  3. I am planning to startup. I have decided to keep 15% of my monthly revenue for marketing activities.

    BTW I am planing to start a restaurant!!!

  4. hey snehil,

    you must update this post when a more comprehensive list now!!

  5. Having been thru one start up and seen thru a few, here is my list in no particular sequence….

    1. Cost of Self-sustenance: if u plan to ditch ur job, cater for 15K x 6, evn if u r living wid ur parents n spend miserly

    2. Cut down on Rent, Start from one of the rooms of ur house. If attracting employees is a prob there, then rent the top floor of the farthest location which still meets ur req. it shud b the cheapest one!!

    3. Hire Strictly according to ur needs. if u need a low level worker, hire same, dont go overboard with hiring with v little in pocket, he/she is most likely to leave first when the ship is in rough seas. Keep this cost as less as possible.

    4. Marketing costs will depend on what field u r in? Evn b4 mktg, most imp thng to know is whats the product? If u r planning to get into high competition sector, unless u hv something really unique or USP, No amount of mktg will really help you scale up, simply bcos once mktg reduces, so will sales.Building loyalty is a big thing. wud come much later. So work on the product shud b no 1 priority. if u r in say site comparison, transport/acc hiring fields etc, tech know-how is critical and costs will be exponentially high. So need to know the sector really.

    5. Firm Registration, CA costs, Original Tally License ( we have though recently shifted to quickbook), UPS+battery backup, House keeper to keep house turned office// hired office in clean condn, electricity bills, society bills, sundry expenses like bldg lift going off, chowkidaar running away, a hired person who leaves after being trained for a few months, cost of looking for employees, PCs, printers, cartridges, internet+ phone bills, 

    6. Stock holding costs ( if ur bz has that), stock depreciation, fuel costs, transportation, pilferage, breakages, wastages, Security system costs, CCTV camera, DVR and HDD costs if u need to safeguard ur assets during ur absence.

    7. General Insurance costs (must when u hold stocks)

    Well these come to my mind, i m sure there are many more, will list as i remember them 🙂

    regds, Sanchita (

    PS: My site is undergoing server n data migration pain pangs. shud b up n running in next 24-36 hours 

  6. There is no laundry list to cover all the costs.  Figure out the business and all the elements needed to get that off the ground.  E.g. if you are doing a phone app then all you need is an internet connection, a computer, your bedroom, and a bank account.  Assuming of course you have the skills to design and code.  If not, then you need to factor in the cost of the designer and developer as well.  You can still skip the office if you are hiring via a freelancer site like odesk or elance.  

    Marketing is a sub head under ‘cost of sales’.  COS is usually 5-20% of sales depending on the business and its level of growth.  Of course if you are a startup you won’t have sales so that is a non-starter.  How much a startup spends on marketing is purely a function of available funding.  If you have the funds after you’ve taken care of your establishment costs throw in all the money into it if you know what you are doing.   

    Typically though startups won’t have any money left after establishment/operations costs and its left to the founders to get creative and get the message of their startup and its wowsome benefits out in front of their market audience.  The marketing equation can be simplified as this: for a successful marketing campaign you need tt(m) i.e. time, talent, and (optional) money. If you don’t have money you will need the other two.  If you don’t have/cannot find tt then better stuff your money in a bank vault or under your mattress.  

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