How Much Does It Cost to Start a Manufacturing Business?
- Nate Jones, CPCU, ARM, CLCS, AU
- Oct 2
- 3 min read
Starting a manufacturing business is a major financial commitment — but with the right planning, equipment, and insurance, it can be a highly profitable venture. Whether you're launching a CNC machining shop, metal fabrication facility, or consumer goods production line, understanding your startup costs is essential.
At Wexford Insurance, we specialize in helping manufacturing businesses protect their investment with tailored insurance programs. In this guide, we’ll break down the typical costs involved in starting a manufacturing business and explain why insurance is a critical part of your startup budget.
Typical Startup Costs for Manufacturing Businesses
Startup costs vary depending on your niche, location, and scale. Here’s a breakdown of the most common expenses:
1. Facility Setup
Leasing or purchasing industrial space: $2,000–$10,000/month
Renovations and buildout: $10,000–$100,000+
Utility setup and deposits: $2,000–$5,000
Helpful Resource: SBA Guide to Leasing Commercial Space
2. Equipment and Machinery
CNC machines, welders, conveyors, and other production tools
Initial investment: $50,000–$500,000+
Consider leasing or financing options to reduce upfront costs
Explore Financing Options: SBA Equipment Loans Overview
3. Staffing and Payroll
Hiring skilled labor, engineers, and administrative staff
Initial payroll budget: $10,000–$50,000/month
4. Licensing, Permits, and Legal Fees
To legally operate a manufacturing business, you'll need to register your company, obtain necessary environmental permits, and ensure OSHA compliance. These costs typically range from $1,000 to $10,000, depending on your location and industry.
Insurance Costs for Manufacturing Startups
Insurance is a vital part of your startup budget. It protects your facility, equipment, employees, and operations from unexpected risks. At Wexford Insurance, we help manufacturers find coverage that fits their specific needs.
Here are five essential types of insurance and their typical costs:
General Liability Insurance: Covers third-party injuries and property damage. Expect to pay around $600–$800 per year
Commercial Auto Insurance: If you use vehicles for deliveries or transport, this coverage costs $1,800–$3,000 annually.
Commercial Property Insurance: Protects your building, equipment, and inventory from fire, theft, and natural disasters. Average cost is $750–$1,000 per year.
Workers Compensation Insurance: Required in most states, this covers employee injuries and lost wages. Costs range from $700–$1,800 annually, depending on payroll and risk level.
Equipment Breakdown Insurance: Covers repair or replacement of essential machinery. Expect to pay $600–$1,200 per year.
Other Startup Costs
Marketing and branding: $2,000–$10,000
Website and SEO setup: $1,500–$5,000
Inventory and raw materials: $10,000–$100,000+
Need Help with Marketing, SEO, and Website for Your Manufacturing Business?
Running a manufacturing business is demanding—finding new clients, managing quotes, and staying visible online can be overwhelming. Contractor Back Office helps you build a strong brand and attract steady work with expert digital tools.
Our Services Include:
Total Estimated Startup Cost
Depending on your niche and scale, expect to invest $100,000 to $1 million+ to launch a manufacturing business. Smaller operations may start lean, while full-scale facilities require significant capital.
Why Work With Wexford Insurance?
Wexford Insurance is a niche-focused agency serving the manufacturing and industrial sector. We work with top insurance carriers to build custom insurance programs that protect your business from day one.
Industry-specific expertise
Access to specialized insurance carriers
Support for startups and growing manufacturers
Fast quotes and responsive service
Final Thoughts
Starting a manufacturing business requires careful financial planning — and insurance should be part of that plan. At Wexford Insurance, we help you protect your investment, manage risk, and build a resilient operation.
Ready to launch your manufacturing business?
Contact Wexford Insurance today for expert guidance .