Author Avatar Business Expenses

by Webnme on Sep 4th 2011

Web Site Planning Tips - Business Expenses

Expenses

Aside from planning for income, you must also consider the costs of setting up and running your web site.  You should factor into your budget the following and any other known expenses you may incur:

  • Supplies and other minor operating expenses
  • Domain name registration costs
  • Trademark search and trademark registration, if you plan to have a trademark
  • Web developer costs
  • Web Hosting costs
  • SSL certificates for HTTPS transactions, if appropriate
  • License and services costs, which may include:
    • Licenses to use software related to your web site
    • License to use a theme or design for a blog or web site
    • Services that filter comments for spam and bot comments
    • Services to protect your domain registration or make it private
    • Services provided by 3rd party vendors such as shopping carts
    • Fees or revenue sharing with 3rd party vendors selling your products
    • Advertising costs for your website
    • Fees for business registration, partnership filings, and/or incorporation
    • Web site maintenance costs
      • Updates to your design
      • Updates to software
      • Security monitoring
      • Insurance – may want to think about publisher’s insurance against copyright and other claims

Some start-up and initial investment costs should be anticipated.  The amount needed depends on your goals, your needs, and whether it is registered as a sole-proprietor business, a partnership, or a corporation.

Profits

If you are starting a web site of your own, you should anticipate that it may be a long time before it is profitable unless you can build a community that generates thousands of page views or unless you have a product that will draw visitors.  You should plan to have enough funding available to run your site until it is profitable.

Once your site is profitable, you need to decide how much profit is distributed and how much is reinvested.  Generally, you want to have some of the profit held back to invest in expansion, better services for customers, hiring people, moving from initial shared hosting to dedicated hosting, or other projects in your overall business plan.

Taxes

You will be responsible for any taxes associated with your web site.  You should anticipate and discuss with your attorney or accountant how you will address:

  • Individual income tax
  • Partnership or corporate taxes

Sales and/or use type taxes depending on your jurisdiction – some states may require you to collect sales tax on sales to residents in the state where your business is located

About Webnme

The developer's first experience with computers was with Fortran IV. Wow that's ancient. After graduate school, he taught history for a number of years at a community college before attending law school and becoming an attorney. In 1997 he changed careers to become a web developer/designer with an interest in all things web related. He currently maintains several dozen websites including a family of websites for a non-profit corporation that gets over five million page views monthly. This is his developer website. The opinions expressed are his own.

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