Business

10 Surprising Expenses That Blindside Business Owners

Opinions expressed by Entrepreneur contributors are their own.

Most individuals and entrepreneurs start a business with the excitement of financial freedom and being their own boss to build something meaningful. Everyone knows the obvious business costs, such as rent, payroll and marketing.

However, there are hidden business costs that can erode profit margins, strain cash flow and catch even the most experienced founders off guard.

Table of Contents

1. Employee turnover and hiring costs

According to studies, replacing an employee can cost 50% to 200% of their annual salary. This factor is underestimated by many people who face further cost, workflow and productivity loss. Recruitment fees, training, lost productivity and cultural impact all add up.

The reasons why employee turnover is expensive:

This includes the fees to post a job on LinkedIn and Indeed
The commission of a recruitment agency (mostly 20-30% of a new hire’s salary)
Time spent on interviewing and onboarding
It reduces efficiency as new employees ramp up

To reduce these costs, businesses must invest in retention strategies. You must offer competitive salaries, create a strong company culture and make employees feel valued.

2. Office space and utility costs

Securing office space is a crucial decision for any business, but it’s essential to assess your needs before committing to a lease or purchase. Consider how much space you require now and how it may change as your business grows.

If you’re a startup with an uncertain future, opting for flexible office solutions like Regus, ShareDesk or LiquidSpace can be a cost-effective alternative to long-term leases. These shared workspaces provide scalability without the financial burden of a permanent office.

Beyond rent, there are additional expenses to factor in, including office furniture, equipment, utility bills, receptionist services and meeting spaces.

3. Equipment maintenance and upgrading

As an entrepreneur, you likely know the essential equipment required to provide a service or for item production. But mostly, smaller equipment is ignored. Basic office equipment includes computers, papers, desks, chairs, scanners and copiers.

From office furniture to computers, wear and tear is inevitable. Most companies neglect to replace or upgrade their office equipment, which is a bad idea. Typical maintenance costs include:

Upgrading outdated computers and software
Vehicle maintenance for delivery or service-based businesses
Repairing office equipment like printers, HVAC systems or kitchen appliances

Regular maintenance can extend the life of business assets and prevent costly breakdowns.

4. Software and subscription creep

Most businesses need software to automate communication, project management, accounting and marketing tasks. A few essential subscriptions can quickly spiral into hundreds or thousands of dollars in recurring costs.

Hidden costs include:

To save these unessential hidden costs, conduct regular audits of your software stack to eliminate redundant or unutilized subscriptions.

5. Payment processing fees

Whether you realize it or not, you are paying transaction fees if your business accepts credit card payments. Payment processors like Stripe, PayPal, and Square typically charge 2.9% + 30¢ per transaction, which can eat into profits, especially for high-volume businesses.

Other payment-related costs include:

To minimize fees, consider negotiating rates with processors. You can offer customers ACH, wire payments or pass fees when possible.

6. Regulatory compliance and legal fees

You need to stay compliant to do business in your community. Laws and regulations vary by industry. Mostly, businesses pay for:

Business licenses and permits
GDPR or CCPA compliance tools (to handle customer data)
Employee labor law compliance (HR policies, mandatory training)
Annual tax filing and bookkeeping

If you ignore compliance, this can result in hefty fines or lawsuits. It can be a cost that should never be overlooked. You must consult with legal experts and keep up with regulatory changes to prevent costly mistakes. Another way is to opt for strategies to reduce your legal liability.

7. Cybersecurity and data protection

You can’t hope that your systems are safe. Cyber threats can be expensive. A single cyber attack can cost a small business hundreds of thousands of dollars in recovery, legal fees and lost customer trust.

Hidden costs of cybersecurity come in the form of:

Installing a firewall and antivirus software, and doing security audits
Costs for employee training on phishing and scams
Ransomware recovery and lost business due to downtime
Legal liabilities if customer data is compromised

Small businesses are easy targets for cyber threats, so it’s non-negotiable to invest in cybersecurity.

8. Shrinkage and inventory loss

Retail and ecommerce businesses lose revenue due to theft, damaged goods and errors. Known as “shrinkage,” this hidden cost is overlooked but can account for up to 2% of total sales.

What causes shrinkage?

Shoplifting or employee theft
Damaged or expired inventory
Administrative errors in tracking and fulfillment

You can use a strong inventory management system software and opt for loss prevention strategies to mitigate these costs.

9. Marketing and customer acquisition costs (CAC)

To attract new customers, many businesses rely on paid ads, SEO, social media and influencer partnerships. However, the return on investment isn’t always immediate.

Hidden costs in marketing:

Rising costs of PPC (pay-per-click) ads due to competition
If the campaign is poorly targeted, it can waste the budget

To lower CAC, focus on organic growth strategies like content marketing, email marketing and referrals.

10. Time

Time is the most undervalued resource. Entrepreneurs spend countless hours on admin tasks, customer support and problem-solving instead of revenue-generating activities.

You can reclaim time by:

Automating repetitive tasks with software
Delegating or outsourcing an employee for non-core activities
Setting boundaries for yourself to prevent burnout

Your time is an investment; spend it wisely to maximize efficiency and profitability.

I recommend setting aside 20% of your revenue for unexpected expenses to prevent financial leaks before they become serious problems. Budget for the real costs, not just the obvious ones.

Intellectual Insider

+ posts

A blog which focuses on business, Networth, Technology, Entrepreneurship, Self Improvement, Celebrities, Top Lists, Travelling, Health, and lifestyle. A source that provides you with each and every top piece of information about the world. We cover various different topics.

Business

Barbara Corcoran’s Beloved NYC Penthouse Is for Sale

1746564378 Barbara Corcoran GettyImages 2208599590

“Shark Tank” star Barbara Corcoran, 76, first got a glimpse of her dream home in 1992.

She was running Corcoran Realty at the time and was delivering letters for a messenger service as a side job to help pay her bills. One of her tasks was delivering an envelope to an apartment on the top floor of a building on Fifth Avenue and 97th Street.

When Corcoran entered the apartment, she was impressed by its terrace with views of Central Park. She gave the home’s owner her envelope and told her to call if she ever thought about selling the unit.

“I walked in and saw this green, lush terrace through the French doors, and said to the lady who let me in, ‘If you’re ever going to sell this, would you sell it to me?'” Corcoran told The New York Times in a previous interview.

More than two decades later, she got a phone call: The home’s owner was ready to sell. Corcoran bought the 4,600-square-foot two-story penthouse apartment for $10 million in 2015 and renovated it for an additional $2 million over the next 18 months.

Now she’s saying goodbye, she says, because of the apartment’s curved staircase—she and her husband, Bill Higgins, 80, a former FBI agent, are finding the steps difficult to navigate. The pair found a new apartment, a single-story penthouse in the same neighborhood of Carnegie Hill, to call home.

Corcoran told The New York Times on Tuesday that she has listed her penthouse for sale for $12 million, slightly lower than what she spent buying and renovating it, but a “fair price” in her estimation. Monthly maintenance fees cost around $11,000.

Related: ‘Better Negotiation Position’: Barbara Corcoran Says Do These 2 Things When Asking For a Raise at Work

The apartment has five bedrooms, five full baths, and two half baths. Corcoran completely revamped the space to include features like a library with a wood-burning fireplace, a butler’s pantry, and a full kitchen off the terrace.

“The apartment is laid out like a multilevel jewel box,” Corcoran broker Scott Stewart, who is co-listing the apartment, told The Times.

Corcoran has previously been enthusiastic about her love of the duplex apartment. In a 2022 interview with TikTok star Caleb Simpson, Corcoran said she sat in the apartment’s kitchen every day and thought to herself, “How lucky am I?”

“Never ever did I think I would have such a pretty kitchen,” Corcoran told Simpson.

@calebwsimpson @barbara.corcoran ♬ Sunroof – Nicky Youre & dazy

Corcoran has recently lost a home due to fires. She revealed in January that fires in LA had destroyed her $800,000 mobile home in Tahitian Terrace Mobile Home Park.

Corcoran previously disclosed that she makes about $4.5 million a year from her investments, including profits she has made as a “Shark Tank” investor for 16 years. The millionaire sold her real estate company, The Corcoran Group, for $66 million in 2001 and has since closed 650 deals on “Shark Tank.”

Related: ‘I’m the Best Boss I’ve Ever Met’: Barbara Corcoran Says It Takes One Principle to Be a Good Boss

Intellectual Insider

+ posts

Business

All Ecommerce Brands Should Leverage This Game-Changing Tech

1746019109 ai personalization ecommerce 0425 g 1332530022

Opinions expressed by Entrepreneur contributors are their own.

Let’s not sugarcoat it — ecommerce is a very competitive arena in 2025. Customer attention spans are shrinking, acquisition costs are rising, and the old playbook of throwing discounts at the wall to see what sticks is tired. What’s working now is relevance. And AI-driven personalization is making that possible at scale.

Let’s agree on one thing: Personalization isn’t and has never been about slapping someone’s name in a subject line. This is about using real data to make the shopping experience feel tailored — intelligently, efficiently and in real time. That’s where AI earns its keep.

Table of Contents

1. Product recommendations that actually convert

This isn’t new, but it’s more important than ever. Product recommendations driven by AI aren’t just “nice touches.” They’re revenue engines. Amazon didn’t stumble into 35% of its revenue from its recommendation engine. It built systems to understand customer behavior at scale — and it paid off.

If your store still shows the same five “featured products” to everyone, you’re not just behind; you’re losing money daily.

2. Search that understands intent, not just keywords

People don’t browse — they search. And if your search engine can’t read between the lines, expect your bounce rate to climb.

Etsy saw a measurable jump in conversions when it applied AI to personalize search results. When shoppers get results tailored to their taste, they don’t just click — they buy.

This isn’t magic. It’s data. And it’s a missed opportunity for any brand not investing in smarter search.

3. Dynamic pricing isn’t just for airlines anymore

Let’s talk about margins. Dynamic pricing powered by AI lets you stay competitive without tanking profitability. It reacts in real time to supply, demand, behavior and context. Yes, context.

If someone’s on the fence about a purchase, a personalized discount can nudge them over. If demand’s through the roof, raise the price. AI lets you do that — without spreadsheets and guesswork.

Done right, it protects both your bottom line and your customer experience.

4. Tailored on-site content: No one-size-fits-all homepage

We’re past the point where every shopper should see the same homepage banner. AI enables on-site experiences to change based on what users are doing, what they’ve clicked and what they ignored.

You don’t need to hard-code this. AI can auto-adjust in real time — whether it’s showing summer gear to someone who just browsed sandals or pushing outerwear to someone eyeing snow boots.

This isn’t gimmicky. It’s what consumers expect now.

5. Predictive analytics: Marketing before the customer knows they need it

Forecasting isn’t just for finance teams anymore. AI looks at historical trends and individual behavior to predict what someone might want next and when.

Think replenishment nudges, pre-season marketing or surfacing the right products based on past timing. It’s not about being creepy. It’s about being helpful — and frictionless.

Ecommerce shouldn’t just respond to behavior. It should anticipate it.

6. Omnichannel isn’t a buzzword — it’s the baseline

Customers are channel-agnostic. They don’t care if they start on mobile and finish on desktop. They expect their experience to travel with them. And AI helps unify that.

Brands like Sephora are already combining in-store and online data to make recommendations feel personal, no matter the touchpoint. That’s not a future vision — it’s the standard.

The SEO angle no one talks about

Here’s something overlooked: Personalization boosts SEO. Not directly, but through the behavioral signals Google and others do measure — bounce rates, time on site, repeat visits, click-throughs. And AI search engines such as Perplexity and Chatgpt Search engines, as well as others, can actually better understand content and user experiences, and more consumers are now using AI-powered search engines to perform searches.

If a user spends five minutes engaging with personalized content instead of bouncing in 15 seconds? That’s SEO gold. And AI personalization is what makes that happen behind the scenes.

A word on balance: AI’s smart, but it’s not strategic

AI can do a lot, but it can’t think for you. It doesn’t understand nuance, brand or what your customers should care about next quarter.

That’s still on you. Or your team. Or your agency. The best companies are building cross-functional groups (sometimes called AI committees) to evaluate use cases and bring strategy into the loop.

AI is the engine. But people still need to drive.

This isn’t just a tech upgrade — it’s a mindset shift. AI personalization is about making every touchpoint smarter and more relevant without adding complexity for the customer. It’s about optimizing experience and performance at the same time.

If you’re in ecommerce and you’re still treating personalization as an optional feature, it’s time to recalibrate. Because customers don’t just want personalization, they expect it.

Intellectual Insider

+ posts

Business

Behind The Scenes Of The Millionaire Milestones Book

After three years of writing, rewriting, and refining, I’m thrilled to officially celebrate the launch of Millionaire Milestones: Simple Steps To Seven Figures!

This book has been a true labor of love, not just for me, but for my family as well. It’s the product of countless early mornings, late nights, and weekends hunched over the keyboard, while also navigating the beautiful chaos of parenthood and everyday life.

Each chapter represents years of financial experience, both wins and mistakes, distilled into clear, actionable steps that anyone can take to build wealth over time. I wrote this book to help people from all walks of life hit their first $1 million in net worth, without needing a lucky break or a six-figure salary.

Whether you’re just starting out in your career, navigating a midlife financial reset, or thinking about how to best guide your children toward financial independence, this book will serve as your practical, no-nonsense companion.

The Making Of Millionaire Milestones: A Conversation With My Wife

To mark the occasion, my wife and I recorded a special 30-minute podcast episode discussing the behind-the-scenes of creating Millionaire Milestones, what readers can expect, and some of the emotional ups and downs that came with the process.

We talk candidly about what it took to stay committed, how we managed the juggling act as parents and partners, and why we believe this book can make a meaningful difference in people’s lives. You can listen to it below:

If you’re curious about the deeper motivations behind writing the book, check out my earlier post here: Why I Wrote Millionaire Milestones: Easy Steps To Seven Figures

A Heartfelt Thank You For Supporting Millionaire Milestones

Since July 2009, I’ve published three free personal finance articles a week on Financial Samurai—over 2,500 posts and counting. Instead of putting up a paywall or subscription service, I’ve also sent out a free weekly newsletter for over 10 years, filled with insights, strategies, and stories designed to help you build wealth and live more freely.

So if you’ve ever found comfort, courage, laughter, or joy in my writing, I hope you’ll consider picking up a hard copy of Millionaire Milestones. At under $28, it’s a small gesture that helps support this site and everything I’ve built since 2009.

And if you’ve been able to build significant wealth from reading my work over the years, there’s no better way to pay it forward than by giving the gift of financial freedom through this book.

If you enjoy Millionaire Milestones, I’d be incredibly grateful if you could leave a review on Amazon or share it with someone who might benefit. Word of mouth is still the most powerful way to spread practical financial knowledge that can truly change lives.

Here’s to hitting your next financial milestone—whatever it may be!

Millionaire Milestones book by Sam Dogen, a national bestseller

If you order a hard copy or more of Millionaire Milestones before May 10, 2025, you’ll receive an exclusive invite to my private video fireside chat on May 25 at 5:30 PM PST. I’ll be sharing deeper insights into the wealth-building strategies featured in the book and how I’m thinking about investing in today’s uncertain landscape. Simply sign up here after your purchase.

For those interested in a more personalized experience: If you order 55 hard copies (available at a bulk discount), you’ll receive a 1-on-1 video consultation with me, plus a full box of books to gift to friends, family, or colleagues. This package includes a 41% discount off my normal consulting rate. If you’re interested, please fill out the form at the bottom of my consulting page here and I’ll get back to you within 24 hours.

To Your Financial Freedom,

Sam