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Startup Expenses
May 18, 2024
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Effectively track and manage your initial costs to set your business on a path to success. Many entrepreneurs have underestimated startup costs and faced the danger of running out of funding. The key to avoiding this pitfall is to adopt a rigorous approach to your research and planning. Seamlessly navigate this process with our Startup Expense worksheet that will lead you through the process.


Begin the estimation of expenses by meticulously considering the costs essential to launch your business. What will it cost you to get your business up and running? The key to accuracy is attention to detail. For each expense category, draw up a list of everything you will need to purchase. This will include tangible assets such as equipment and inventory; as well as services such as remodeling and insurance. Then, determine where you might buy these goods or services. It is advisable to research more than one vendor and compare the quality of terms, delivery reliability, and service quality.  


It is important to add a reserve for contingencies. Explain in your narrative how you decided on the amount you put into this reserve. This can be determined by assessing the potential risks and uncertainty in your business plan. Consider factors such as market volatility, economic shifts or unexpected expenses. A common approach is allocation a percentage of the total budget, typically around 10-20% to use as a cushion to offset any unforeseen circumstances.  

Working Capital

Maintaining a cash cushion to meet expenses while the business starts and grows is an important step in ensuring financial stability. A best practice is to create a 12-month cash flow projection where you identify an estimate of your working capital needs. If you are unsure of this amount, you can leave this area blank for the short term. 


Now that you have estimated how much capital will be needed to start, you should focus on the top part of this worksheet. Enter the amounts you will put in yourself, how much will be injected by partners or investors, and how much will be supplied by borrowing.


If you will be using this plan to support a bank loan request, use the section near the bottom to show what assets are offered as collateral to secure the loan and give your estimated value of these items. Be prepared to provide some proof of your estimates. 

Would you like help determining your startup expenses or how to use this template? Find a free SCORE mentor who can work with you. 

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National Bankers Association Foundation

The National Bankers Association Foundation’s mission is to eliminate the racial wealth gap by ensuring underserved communities have fair access to transformative financial education, services, and resources. To accomplish this, we support the work of Minority Depository Institutions (MDIs) through our four strategic pillars, which include: Financial Education, Entrepreneurship and Small Business, Research and Impact, and Collaboration and Capacity Building.

National Bankers Association Foundation
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Washington, DC 20002

Copyright © 2024 SCORE Association,

Funded, in part, through a Cooperative Agreement with the U.S. Small Business Administration. All opinions, and/or recommendations expressed herein are those of the author(s) and do not necessarily reflect the views of the SBA.

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