When you’re in the process of getting your small business off the ground, you might be tempted to cut costs. It’s true: starting a new business is expensive. The Small Business Administration (SBA) estimatesthat new business owners spend an average of $1,000-$5,000 for a home-based franchise. In 2009, the Kaufmann Foundation said the average start-up cost as much $30,000.
There’s a disparity in these findings, so let’s say that the average small business costs somewhere in the middle, say at $15,000 to start.
This may seem low-cost, but keep in mind that this is only to start the business, not to keep it going. Also know that most Americans have less than $1,000 in the savings account, so starting a business would be a huge financial undertaking. If the business should fail, the small business owner doesn’t have their personal finances to fall back on.