As you get into small business ownership, you will notice that there are costs associated with nearly everything. This is normal and to be expected.
The video above, titled “Costs of Starting a Small Business in Canada”, will take you through the various costs that you have to consider as you start a small business in Canada.
This video is part of the small business video series, which you can access to learn more about starting up, building a business plan, finding funding, and more.
Costs of Starting a Small Business in Canada
As you get into small business ownership, it is crucial that you understand that there are costs involved.
A good rule of thumb is to assume that everything costs.
To be prepared for the process of starting up, the day-to-day operational efforts of your business, and to expect the unexpected, it is a good idea to have a budget in mind.
Additional funding may be needed, but let’s start by understanding what to consider:
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Initial Startup Costs
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Operational Costs
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Unexpected Costs
Every business is different. A brick-and-mortar business (like a restaurant) will have very different costs compared to a web-based business. Planning your own model individually is key.
Initial Startup Costs
When starting a small business, there are many things to consider.
Having a business plan is strongly recommended, as it helps guide your decisions—especially around startup costs.
Startup costs are the expenses required to launch your business. Without covering these, you cannot start.
Examples include:
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Tools, supplies, inventory, or equipment
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Marketing materials
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A website
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First month’s rent
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Initial wages (yourself or staff)
Example: Cleaning Business
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Cleaning supplies (chemicals, brooms, brushes)
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Equipment (vacuum, carpet cleaner, steamer)
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Website and business cards
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Transportation (vehicle)
Example: Online Business
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Website and hosting
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Security tools
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Marketing budget
Bottom line: you need startup capital to get off the ground.
Operational Costs (“Day-to-Day Costs”)
Once launched, your focus shifts to ongoing operational costs.
These are recurring expenses required to keep your business running.
Examples include:
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Rent
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Utilities
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Inventory restocking
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Marketing
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Salaries and wages
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Taxes
Small Costs Add Up
Don’t ignore the small expenses:
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Printer paper and ink
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Office supplies
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Coffee
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Software subscriptions
Quick Fact:
20–25% of business expenses often come from small, overlooked costs. Review and adjust your budget regularly.
Unexpected Costs
Not everything goes as planned.
Unexpected costs can arise at any time, so it’s important to have a financial buffer (rainy day fund).
Common examples:
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Equipment failure
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Taxes
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Supplier price increases
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Insurance
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Rent increases
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Delayed payments
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Illness
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Damaged inventory
Example
If you’re an Uber driver and your car breaks down:
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You lose income for the day
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You must pay for repairs
Unexpected costs are unpredictable—plan ahead.
Final Thoughts
Starting a small business in Canada comes with unavoidable costs.
The goal is to:
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Understand them
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Plan for them
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Prepare funding if needed
A business plan helps you:
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Identify startup costs
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Manage operational expenses
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Prepare for unexpected challenges
If you found this helpful, explore more from the video series: