Running a small business is hard work. It takes grit, determination, ambition, and the willingness to roll your sleeves up and get your hands dirty. You need to be an expert juggler, balancing budgets, customer needs, operations, and more.

But even the most experienced entrepreneurs can be blindsided by hidden expenses that erode profits and threaten long-term profitability. Here are five surprise costs that could sink your small business (and what to do about them).

Marketing

What good is having a great product or service if no one knows about you? If you’re not actively marketing your business, you might as well not exist. Too often, new business owners think, “If we build it, they will come,” or “I’ll just make some social media posts, and customers will come pouring in.”

Sad to say, these ideas are just pipedreams. Every business, no matter it’s size or type, needs to market itself. And while social media and word of mouth can be effective, they take a lot of time to build up; and you may even have to pay for them to some degree.

The Fix: Business owners need to think about other ways to market their business—and that takes money. Whether it’s paid ads, SEO, email campaigns, or local sponsorships, you need to spend money to make money. Skimping here can mean stagnation, while smart marketing can drive growth.

Theft 

One of the most gut-punching surprises a small business can face is realizing that your inventory or hard-earned cash is disappearing. Theft—either from people visiting your business or even employees, can quietly bleed your business dry.

External theft, like shoplifting or break-ins, is the most obvious threat. But internal theft—employees skimming the till, giving unauthorized discounts, or manipulating inventory—can be even more damaging.

The Fix: To protect your business:

• Invest in security systems like cameras and alarm systems.
• Use inventory management software to track stock in real time.
• Implement clear policies and training for staff to prevent internal theft.
• Conduct regular audits to catch discrepancies early.

Employment Taxes

Being able to hire staff is a major milestone for a new business, but it comes with a bundle of hidden costs. In addition to salaries, you’re responsible for In addition to National Insurance contributions, employers must account for pension auto-enrolment, holiday pay, and statutory sick pay, all of which add up quickly. These costs aren’t optional, and failing to budget for them properly can lead to cash flow issues or penalties from HMRC. 

The Fix: Before expanding your team, make sure you’ve factored in the full cost of employment, not just the salary. 

Equipment Breakage

Whether it’s a POS system, a coffee machine, or a delivery van, your business relies on equipment that won’t last forever. When something breaks, not only do you need to pay to have the equipment fixed, but the downtime can be expensive, costing you lost sales, frustrated customers, and wasted time. Many business owners don’t think about support contracts or extended warranties until it’s too late, but these can be lifesavers when things go south.

The Fix: Plan ahead with backup systems, maintenance schedules, and service agreements with your providers. Sign up for support plans or warranties from your vendors. Even if they might feel like an unnecessary expense, they can save you from a financial emergency down the line.

Physical Networking

Reliable internet isn’t a luxury for today’s businesses; it serves as the backbone of your business’ infrastructure. But many small business owners overlook the physical infrastructure needed to support it. From routers and switches to cabling, access points, and backup systems, setting up a secure and stable network is more complex than just plugging in a WiFi box. Poor connectivity can lead to slow transactions or even lost sales.

The Fix: Invest in proper networking hardware and professional setup. It might not feel urgent at the outset, but it will when (not if) your system crashes mid-sale and you’re left scrambling.

The Ultimate Fix: Budgeting

Surprise costs are inevitable, but being blindsided by them doesn’t have to be. The real fix is prevention using strategic budgeting. When you build a budget that includes setting funds aside for emergencies, you’re protecting your business by planning for the unexpected. Additionally, it’s a good idea to review your expenses regularly, and treating “hidden” costs like marketing, maintenance, and infrastructure as core parts of your financial plan, not afterthoughts.

Ready to take control of your business costs? Learn how Everything EPOS can help you streamline operations, reduce costs, protect you from surprises, and grow your business. Visit Everything EPOS to explore smart solutions built for small businesses just like yours.