Are you starting to build a business? Do you have questions about the costs you’ll have to face in order to be as predictable as possible? Here are some things to guide you.
What are the Different Types of Business Start-up Costs?
Different types of costs are expected depending on the stage of existence of your business. First, there will be upstream costs related to preparation, followed by costs arising from construction formalities. Once the activity begins, it will be necessary to estimate the fixed costs of the first years of management.
company preparation costs
Before building a business, you must have defined a project and ensured its viability. This means that there are likely to be costs before setting up your business. Depending on your project, not all of these will concern you. Optional for the most part, they are often essential to the development of a solid project.
Market study and business plan
The cost of a market study will depend on the scope of the project as well as the mission of the mandated specialist. Usually between 500 and 1000 € excluding taxes, this can increase significantly depending on the complexity of the study and the service provider chosen. It is important to establish an accurate business plan to start the activity in real conditions. A good business plan is a valuable communication tool. Evidence of the sustainability of the project, it is necessary in the context of the search for partners and means of financing.
You can call an accountant or an expert professional for this. It is necessary to plan on average between 150 and 600 € excluding taxes, but here again prices vary.
support cost
Depending on the targeted activity, it may be necessary to build a website and entrust its design to a professional. Hence it will be necessary to plan for the cost, which varies according to the type of site. If the creation of a business is associated with a new idea to protect, it is reasonable to include the cost of protecting intellectual/industrial property upstream, such as trademark registration (with INPI of €225 HT), patents (with an INPI of €500) between) and €700 excluding VAT) design or model, etc. There may be a cost of obtaining a compulsory license, where applicable, for setting up a business in the catering sector. It is also necessary to budget communication expenses so that it is possible to find the company (brochures, business cards, promotions).
Miscellaneous costs
Beyond the strict administrative costs of setting up a business, you also need to think about ancillary costs. Depending on the area of ​​activity, there may be ancillary costs incurred prior to construction, such as those related to various visits (prospecting, meetings with partners, investors), or the acquisition of goods.
It may also be necessary to provide for some training costs. If you are a craftsman, you can follow SPI (Installation Preparation Course) to get the basics you need for business management. Provided by CMA, it costs around €194.
Costs related to business creation formalities
The administrative cost of setting up a business is accompanied by disproportionate costs associated with the registration process. These costs vary according to the type of company and the nature of the activity (commercial and/or artisanal, eclectic, commercial agent).
registration fee
These are the legal registration fees that arise from the creation, modification and deletion of any business. Depending on the nature of your activity (commercial or craft), you should register with the Business and Companies Register (RCS) or the Business Directory (RM). For liberal or agricultural activity, formalities have to be completed with the URSSF or the Agricultural Chamber. In the case of a sole proprietorship (natural person), it is necessary to provide approximately €25 in the Business and Companies Register and €130 in the Business Directory. For a company (legal person) these costs average €40 on RCS and €230 on RM. You should also know that registration in micro enterprises is free.
In implementing the PACTE law (2019-486 of May 22, 2019), all formalities related to the creation of the business must be completed through a single system centralizing the currently existing 6 CFE networks. Its use is possible to date, although optional. For more details you can visit the official website of Govt.
Publication of legal notice
Publication of a legal declaration of incorporation in a declaration newspaper is mandatory in the event of the formation of a company. Previously variable according to departments, now the price is fixed at a uniform rate as per the legal form (reform of PACTE law dated May 22, 2019). They range from 121 to 347 €.
Share Capital Filing Fee and Contribution Auditor
When forming a company, the partners are obliged to deposit share capital, the amount of which differs legally (so individual entrepreneurs are not concerned). It is possible to deposit money in the bank. If it is physical, the deposit will be free when the account is opened or in existence. Online banks usually charge a fee for this service (around €100 or less depending on the offer). These funds, constituting the capital, may also be the subject of a deposit with a notary who can also decide on the legal framework of the project (drafting of statutes, etc.). Invoicing will generally be based on a flat rate per time.
In addition, the deposit of contributions by the partners during the incorporation of the company (subject to the amount and conditions of legal form) should be accompanied by the appointment of a contribution auditor responsible for assessing the value. Fees can vary from 500 to 3000 €.
One for SARL (Article L 223-9 of the Commercial Code), for SAS (Article L 227-1 of the Commercial Code).
corresponding cost
Even if it is tempting to draft your company’s statutes yourself, in some cases it is advisable to resort to a professional. Depending on the complexity of your project and its specifications (number of partners, legal form of the company, level of risk), the expertise of a jurist, attorney or notary can protect you from the legal and financial risks associated with improper drafting. Keep in mind that the automated models offered may not necessarily suit the company you’re planning on. In practice, the use of a professional for drafting the law (depending on the project) averages between 500 and 3000 €.
It may be mandatory to register the Articles of Association with the SIE (Department of Tax and Trade) when it is required in the form of a deed or when it involves an operation subject to registration. A list of related acts is provided in Article 635 of the CGI.
Costs related to the first years of management
It is difficult to have an accurate view of the revenue of a newly created company. During the first years of management, it is important to anticipate unavoidable management costs. Council, automatically integrate them into the share capital.
In addition to expenses related to your activity, the costs you will incur depending on the type of business are to be considered. If your company is a SA, SAS or SARL, you will be liable for corporation tax (at a lower rate depending on your business). As an individual entrepreneur, the tax regime will depend on your activity and your business. Along with salary and social fees, it will also be necessary to take into account management fees (chartered accountants, auditors, membership of an approved management association). You also need to take into account additional costs (professional bank account, purchase of website domain name, insurance, etc., if necessary).
What are the cost of formalities to set up a business?
| legal status | Registration | legal notice | share capital deposit |
|---|---|---|---|
| SARL/EURL/SNC/SC | RCS (€37.45), RM (€45) | 144€ to 216€ . until | Compulsory (except SC), free amount, bank fee (between 0 and 100 €) or notary fee |
| SA/SAS | RCS (€37.45), RM (€45) | SAS (€387), SAS (€193) | compulsory (minimum €37,000 for SA); Bank fee (between 0 and 100 €) or notary fee |
| micro entrepreneurial trader | RCS (free) | Needless to | Needless to |
| micro entrepreneur craftsman | rm (free) | Needless to | Needless to |
| liberal professional | Ursaf (free) | Needless to | Needless to |
| commercial agent | RSAC (€25.19) | Needless to | Needless to |
| Sole Proprietorship | RCS (€25.34) | Needless to | Needless to |
| Sole Proprietorship (Artisan) | RM (45 €) | Needless to | Needless to |
How to reduce the cost of starting a business?
Your budget is limited and you want to reduce the cost of building your business? You can visit an online business building site (legaltech). For moderate to cost turnkey solutions, these structures manage the formalities for setting up your business (drafting of Articles of Association, registration, etc.) as per the package chosen for you.
Sites like LegalStart or LegalPlace can be useful to you and save you the high cost of hiring a professional. You also have the option of using online status templates. But stay tuned, these are the foundation of your business. Some sections are not insignificant and may require deeper consideration depending on your situation. An error in drafting can prove to be more costly than the savings made. If your project is complex or specialized, hire a professional.
questions to ask
What is the cost of setting up a business?
The cost of setting up a business varies according to its legal form and its field of activity. Depending on the position chosen, the cost of legal formalities ranges from free (micro-entrepreneurs) to an average of 300 to 400 euros (companies). Ancillary preparation and support costs should be added if necessary.
What are the formalities for setting up a business?
The formalities vary according to the situation. From simple registration with the competent CFE for natural persons, companies are required to draft statutes, accumulate share capital, and publish a legal notice of incorporation.
How much does business registration cost?
The price depends on the legal form chosen. Free for a micro-entrepreneur or liberal profession, it averages between €25 and €37 for other companies. Don’t forget the costs of legal declarations of incorporation when publication is mandatory.