Five sneaky expenses that can start to add up over time

Barnaby Smith

The hidden costs in running a small business, those expenses that seem to accumulate when you’re not looking, can be a nasty surprise – particularly for startups that didn’t necessarily see them coming or budget for them.

Many business advisors suggest putting aside 20 per cent of your operating budget to deal with such costs.

Here are some of the most common expenses that can be an unanticipated nuisance.


All businesses must prioritise insurance, but what can pass under the radar are the different kinds of insurance required – including those that are specific to your type of business. These can range from liability insurance covering public liability, professional indemnity and products liability, through to employee insurance, covering things such as workers’ compensation and accident insurance. Insurance premiums can mount up, yet they’re essential.   

Professional fees

The services of accountants and lawyers should never be underestimated. Finding the right professionals is vital, and even if they seem like an expensive outlay initially, their skills allow your business to save money in other areas – particularly if they have expertise in your industry. Going for cheaper, less qualified professionals can lead to inconvenience and further expense when they don’t work out, and unless you have plenty of time and plenty of specialist knowledge, taking care of accounts and legal matters yourself is out of the question.

The licences your business may be required to hold can be extensive, and specific to your industry.

Licensing fees

The licences your business may be required to hold can be extensive, and specific to your industry. It can also depend on whereabouts your business is based (with state or city regulations). You may need a licence to practice in your particular field, safety licences, premise licences and special licences for employees. Again, professional help is worthwhile.

Travel costs

Travel costs are one expense that really can be unexpected. Jetting off somewhere at short notice to meet a client or make a pitch is a common, expensive occurrence. You may also have employees who regularly need to travel – clear guidelines for this are important, as is ensuring you have available funds to be called upon should an urgent trip need to be taken.

International finance costs

Countless Australian small businesses rely on overseas clients and international transactions. As well as international transaction fees with your bank, costs can mount up through third parties such as PayPal, which charges roughly 3 per cent of each transaction. Consider splitting such fees with the other partner in the transaction.

Barnaby Smith

Barnaby Smith is a writer and journalist who has written for a variety of publications across several subject areas in the UK, Australia and Switzerland.

Image: Robert Couse-Baker, Flickr Creative Commons license

How to maximise the freedom and flexibility of your business

Technological acceleration has seen business owners aim to combine a versatile lifestyle with their professional ambitions.