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How Much Does It Cost to Start a Garage Business?

With as low as $5,000 or even lower, you should be able to start a small-scale garage business especially if you will be operating the business from your home garage or rented garage.

Or if you are offering services such as carpet cleaning, a graphic design studio, handmade crafts and art, bicycle repair and customization, vintage clothing resale, garage rental business, consignment business, and even startup IT business et al.

It is important to note that you can also spend over $150,000 to start a standard and well-equipped garage business. This goes to show that some key factors can determine the total budget for starting a garage business.

A garage business is a small-scale business or startup that is run from someone’s garage, home, or a similarly informal and small space. In this article, we will look at some major factors that can influence the cost of starting a garage business.

9 Factors That Influence the Cost of Opening a Garage Business

  1. Your Choice of Location

When we talk about the location of a business, we are not just talking about the physical address of the business, but also about everything that the location of the business brings.

Of course, you know that the location of a business will determine how much rent or lease you will pay, it will also determine how much you will spend on labour and employment, operational costs, and utilities.

For example, if you lease a garage facility for your garage business in a busy business district, then you will spend more compared to someone who rented or leased a garage facility on the outskirts of town or in a small city.

  1. The Choice of Facility

A garage business can be started from just a small office (a small garage facility) on a street corner, but to start a standard garage business, you are expected to rent, or lease a garage facility that comes with a storage space for your materials, tools, equipment, and supplies.

Trust me, to get a facility that is big enough, you must be ready to spend extra money, and that to a large extent will influence the cost of starting a garage business.

  1. Your Niche (Service or Product Offering)

It will cost you far less to start a garage business that rents storage spaces or even sells consignment goods from the garage than what it will cost you to start a garage business that is into home brewery, mobile detailing, or even custom car modification.

Of course, you know the amount it will cost you to source for the equipment you need will take a larger portion of your budget.

  1. Your Budget for Equipment and Supplies

If you are planning to start a garage business that is into carpet cleaning services, then you must make plans to purchase an industrial garage machine, carpet brush, garage wand or tool, air mover fans, carpet brushes or agitators, water testing kit, safety equipment (gloves, goggles, mask), chemical storage containers, etc. Please note that the quality and quantity of the equipment, tools, and supplies you plan to buy will impact your budget.

  1. Licensing and Permit Requirements

You cannot legally start a garage business in the United States of America without having the basic licenses and permits.

The licenses and permits can include a business license, trade name registration, zoning permits, environmental permits, health and safety permits, f

ire department permits, chemical handling permits, air quality permits, hazardous materials permits (if applicable), building permit (for facility modifications), waste disposal permit (if applicable) and signage permits (for storefronts).

Note that there might be other permits or licenses that are unique to the city or state you want to start your garage business hence you should make your enquiries from the nearest local government or county office.

  1. Your Budget for Insurance

The need for insurance for a business is not just about complying with state regulations but protecting the business owner, and the business from claims, accidents, and unforeseen events that can ruin the business.

In essence, if you are planning to start a garage business, then you must make plans to purchase at least some of the basic insurance coverage for a garage business.

You may need general liability insurance, professional liability insurance (errors and omissions), commercial property insurance, business interruption insurance, workers’ compensation insurance, equipment breakdown insurance, employment practices liability insurance, and environmental liability insurance.

  1. Your Budget for Marketing and Branding

If you are planning to start a garage business, then you must create a robust budget for marketing and branding that covers your website, the designing of a logo, printing your business cards, and other promotional materials.

Even though there are no specific costs attached to marketing and advertising a business, the bottom line is that if you want to launch a garage business that will win a fair share of the available market share in your location, then you must be ready to invest a significant amount to promote your products or services.

  1. Your Budget for Staff and Labor

Getting started with a standard garage business means that you must be ready to hire competent people who would help carry out the day-to-day activities. This also depends on the scale at which you want to set out.

If you choose to start small, you might want to hire one person or two. If it is on a large scale, then you might want to higher more hands to get the job done.

Take note that on whatever scale you opt to start on, you cannot start alone. You would always need experienced people or apprentices to work with you.

  1. Miscellaneous Expenses

When we talk about miscellaneous for a garage business, we are talking of a budget that covers your utilities, unexpected expenses, waste disposal, and the transportation of your equipment, supplies, and workers to and from project sites if you are offering outstation services.

Although, your budget for miscellaneous might depend on the extra money that the owner of the business has to spare, but it is indeed an important factor that can influence the cost of starting a garage business.