Actual cost of starting a business in Malaysia

In this part, we looked at the cost of opening an offline store rather than online.

Market Research Fee

Before starting a business, you need to conduct a careful study of the industrial and consumer markets. Don’t jump in blindly. You can chat with others who have started a similar business and do further research on your business needs. If you have easy access to the internet, this step is very easy and straightforward. These are the cheaper options. However, if you have questions and want to have professional insights, you can hire a local company to help with the evaluation process. Professional market research is priced at MYR 4,000.00 for basic research and may increase for more in-depth research.

Capital rental fee

You need capital to start any kind of business. For small businesses, the most likely source of financing is debt in the form of small business loans. Business owners can often get loans from banks or private investors such as family and friends. Business loans certainly entail interest payments. These payments should be planned and considered because the default cost is so high when you’re just starting out. Banks typically offer funds up to RM3,000,000 for a three-year term at an interest rate of around 5%. Starting at a Malaysian culinary café and borrowing a loan of RM150,000, monthly payments can be up to RM4791.67 (5%).

Insurance, license and permit fees

All businesses must file legal requirements prior to opening. Food business owners are generally required to submit health screening approvals before proceeding with applications for business licenses and permits. Some businesses may need to apply for an industry-specific permit. However, in general, online merchants incur the following costs: Incorporation, office preparation, online shopping mall production, advertisement, logistics, insurance, etc. are included. The starting cost of sole ownership may differ from partnership. Some of the additional costs incurred by the partnership include the legal costs required to complete the partnership agreement fee.

office rent

Even if your business is online, if you are targeting the ASEAN market, you need to prepare your business in ASEAN countries. In this case, you need to decide whether to rent or buy from the most strategic location. Renting 1,769 square feet at Desa Park City Plaza Arcadia for a cafe costs RM7,800 per month. Other common costs associated with business buildings include architectural plans and basic premise modifications such as electricity, lighting, painting, security systems, ventilation systems, plumbing, etc. It costs at least RM 150,000 for a simple cafe renovation.

equipment

Every business needs some type of equipment and basic consumables. After determining what you need based on the nature of your business, you need to consider whether to rent or buy equipment. This can vary greatly depending on your financial ability.

This list may include stationery, as well as furniture such as tables, chairs and cabinets, and computerized cash registers.

Delivery Van

If individual delivery is required, costs must be allocated to bring the company vehicle and maintain it. In recent years, penalties are imposed on delivery of goods by own vehicle rather than a commercial company vehicle.

Business-related equipment such as large refrigerators and utensils can also add to the cost. You can get furniture from factories or used dealers at low prices.

Safety items such as first aid kits, smoke alarms and fire extinguishers are essential. For a cafe, it is about RM65,000.

Advertising and promotional expenses

Adequate advertising and promotion is needed to attract and retain customers. When starting a business, you need to inform the public about the products or services you offer.

  • Logo (RM800),
  • Website (RM3,500),
  • Brochure (RM1,000 for 500 A2 double-sided brochure)
  • Business card (RM40 for 3 boxes)
  • A sign (RM40) is required. RM5,000)
  • Social Marketing RM 14,500

Services from graphic designers and website developers are required, and other costs such as the website’s domain and hosting costs (RM300) are also included. All of this can be up to about RM25,000.

employee expenses

If you need help running your business, you will have to hire employees, pay salaries, and provide other benefits such as employee-provided funds (EPF), medical insurance, uniforms and safety clothing. You should also include hiring costs, such as job advertisements. If you don’t properly reward your employees, you’ll have less morale and higher turnover, which can be a bad publicity for your business and incur additional training costs for new employees. Let’s say you have 5 employees with an average salary of RM3,000. Monthly cost Annual cost Salary (RM3,000 per employee) RM15,000 Annual medical bills (up to RM800 per employee) RM4,000 EPF (13% per employee) RM1950 Uniforms (RM50 per set, 2 sets per employee) RM500 SOCSO (1.75% per employee) RM262.50

Sum RM17,242.50

EIS (0.2% per employee) RM30

Sum RM4,500

Employers with a total of 5 employees are required to pay RM211,410 annually.

technology cost

Technology helps every business function more effectively and categorizes the basic business functions that are routine. This cost category depends on the type of business and includes hardware such as computers, printers, scanners, modems, photo state machines, accounting, security, documentation, Internet expenses, Wi-Fi, and software for mobile expenses. For the cafe, you can get phone and Wi-Fi services from UniFi for RM349 per month and related software such as salary of RM400, inventory and billing of RM700, and paid marketing online (RM500). Set up your business.

Administrative expenses

It’s a good idea to split your costs into ongoing and one-time costs. Also, if you overestimate the cost and include a buffer in your budget, there will be no big surprises later. The one-time fee should include everything your business needs to work on the first day. So, to start a cafe in Klang Valley, you will need at least: One-time cost Monthly cost Market research fee RM4,000 Loan repayment RM4791.67 Compliance requirements RM3,060 Premises rental RM7,800 Premise renovation RM150,000 Technology cost RM1,949 equipment RM65,000 Employee Expenses (Salary & EPF) RM17,242.50 Advertising and promotion RM25,000 premium RM900 Employee expenses (medical insurance and uniforms) RM4,500

Sum RM291,200 Sum RM32,683.17

To manage ongoing costs, you should consider developing cash flow forecasts. This allows you to know when money will flow into and out of your business over the next 12 months. Another major factor affecting your monthly budget is the cost of food supply and utilities. Cash is always on hand when overlooked or unexpected expenses arise.