Whether it is a new business you are setting up or one that has been trading for a while, you will need to work with, and understand, management accounts.
You may well ask exactly what management accounts are. In a large company, they tend to be a monthly snapshot of how the business has performed in the previous calendar month. They can be quite detailed for the biggest firms, because they need to understand how and where the profits (or losses) and costs are occurring or being created.
If you are a smaller venture, then you will more than likely not have an accountant producing reams and reams of figure and incomprehensible statistics. But, you will have management accounts, these will be in your head, or if you need to, put down quickly when you consider the last months business activity.
You will know what you have sold, what your costs are likely to be and as a consequence what the profit/loss is.
As part of this, you need to consider the ongoing fixed costs, including business insurance.
You may receive an annual quote from your appointed business insurance broker of, say £1,000. Divide by 10 or 12, depending on the instalment deal, and you can work out what your costs will be. This can be added together with your other fixed (premises, rental, power etc) costs.
But watch out for instalment charge, in 2010, you should not pay any more than 5% for your instalments. In most cases, you will get these free. Whilst a few per cent may not seem like much, depending on your actual insurance premium, a bit of shopping around to an interest free option, can save you money.