You’re comparing formation providers.
But pricing is confusing. Base prices are misleading. Total costs are hidden.
You need a fair comparison.
What’s included. What’s extra. Total first-year cost. Ongoing expenses.
This framework shows you how to compare.
Comparison template. Cost breakdown. Fair evaluation. Your decision.
Read this. Use the framework. Compare fairly.
Key Takeaways
- Compare total first-year costs, not just base prices—initial fees are misleading, total first-year cost is what matters
- List all required services for each provider—state filing, publication, registered agent, business licenses, and expedited processing
- Calculate initial costs plus first-year ongoing costs—annual reports, franchise taxes, registered agent renewals, and business license renewals
- Factor in service quality and value—cheapest isn't always best, consider service quality, support, and included features
- Use the comparison template to evaluate fairly—structured comparison prevents mistakes and ensures you choose the best value
Table of Contents
Why Framework Matters
Framework ensures fair comparison.
What happens if you don’t use a framework:
- Compare apples to oranges
- Miss hidden costs
- Choose wrong provider
- Pay more than needed
What happens if you use a framework:
- Compare fairly
- See all costs
- Choose best value
- Save money
The reality: Framework prevents mistakes and ensures fair comparison.
Step 1: List All Services
What to list:
- State filing fees
- Publication requirements
- Registered agent services
- Business licenses
- EIN application
- Operating agreement
- Expedited processing (if needed)
Why it matters: You need to compare the same services for each provider.
Pro tip: Create a checklist of all required services. Use this for each provider. See our true cost guide for what’s typically required.
Step 2: Calculate Initial Costs
What to calculate:
- Base formation fee
- Publication fees (if required)
- Registered agent setup
- Business license fees
- Expedited processing (if needed)
- Name reservation (if needed)
Why it matters: Initial costs vary significantly between providers.
How to calculate:
- Get quote from each provider
- List all initial fees
- Add up total initial cost
- Compare initial totals
Pro tip: Initial costs are just the beginning. Don’t stop here. See our pricing guide for spotting tricks.
Step 3: Calculate Ongoing Costs
What to calculate:
- Annual reports
- Franchise taxes
- Registered agent renewals
- Business license renewals
- Compliance tracking (if needed)
Why it matters: Ongoing costs continue every year and add up.
How to calculate:
- Ask about annual fees
- Check state requirements
- Calculate first-year ongoing
- Plan for future years
Pro tip: Ongoing costs are often hidden. Always ask about annual fees. See our budgeting guide for planning costs.
Step 4: Compare Total Costs
What to compare:
- Initial costs + first-year ongoing
- Total first-year expense
- Ongoing annual costs
- Multi-year totals
Why it matters: Total first-year cost is the real comparison.
How to compare:
- Add initial + first-year ongoing
- Compare first-year totals
- Factor in ongoing annual costs
- Consider multi-year value
Pro tip: Always compare total first-year costs, not just initial fees. This is the fair comparison.
Step 5: Evaluate Value
What to evaluate:
- Total cost vs. service quality
- Included features
- Support and service
- Reputation and reliability
Why it matters: Cheapest isn’t always best. Value matters.
How to evaluate:
- Compare total costs
- Assess service quality
- Review included features
- Check reputation
Pro tip: Balance cost with value. Sometimes paying more gets you better service and fewer problems.
Comparison Template
Use this template to compare providers:
Provider Comparison Table
| Service | Provider A | Provider B | Provider C |
|---|---|---|---|
| Initial Costs | |||
| Base formation fee | $X | $Y | $Z |
| Publication (if required) | $X | $Y | $Z |
| Registered agent setup | $X | $Y | $Z |
| Business license | $X | $Y | $Z |
| Expedited processing | $X | $Y | $Z |
| Subtotal Initial | $X | $Y | $Z |
| Ongoing Costs (First Year) | |||
| Annual report | $X | $Y | $Z |
| Franchise tax | $X | $Y | $Z |
| Registered agent renewal | $X | $Y | $Z |
| Business license renewal | $X | $Y | $Z |
| Subtotal Ongoing | $X | $Y | $Z |
| Total First Year | $X | $Y | $Z |
| Ongoing Annual (Year 2+) | $X | $Y | $Z |
| Service Quality | Rating | Rating | Rating |
| Included Features | List | List | List |
| Support Quality | Rating | Rating | Rating |
How to Use the Template
Step 1: List all required services in the first column.
Step 2: Get quotes from each provider for each service.
Step 3: Fill in costs for each provider.
Step 4: Calculate subtotals and totals.
Step 5: Evaluate service quality and value.
Step 6: Make your decision based on total value.
Pro tip: Use this template for every provider you’re considering. It ensures fair comparison and prevents mistakes.
Your Next Steps
Use the framework. Compare fairly. Choose the best value.
This Week:
- Review this guide
- List all required services
- Get quotes from providers
- Use comparison template
This Month:
- Complete comparison for all providers
- Calculate total first-year costs
- Evaluate service quality
- Make your decision
Going Forward:
- Track actual costs
- Compare to your comparison
- Adjust if needed
- Share framework with others
Need help? Check out our true cost guide for detailed breakdowns, our budgeting guide for planning costs, our pricing guide for spotting tricks, and our horror stories guide for learning from mistakes.
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Sources & Additional Information
This guide provides general information about pricing comparison. Your specific situation may require different considerations.
For true formation costs, see our True Cost Guide.
For budgeting, see our Budgeting Guide.
For pricing understanding, see our Pricing Guide.
For learning from mistakes, see our Horror Stories Guide.
Consult with professionals for advice specific to your situation.
