Start a business in your home
We recently undertook a study to determine what are the ten most important tips for home based business, and, interestingly, the successful businesses have a lot in common. So do the train wrecks. Here are ten suggestions to improve your chances of building a successful home-based business and avoiding the brick wall known as CRASH and BURN.
How do I start a business in my home?
With all of the competition for jobs, building a business is becoming more popular and if you’re thinking of launching a new business in an office around the corner in a rented space within the local strip-center, think again. More than half of all small businesses in the United States are based in someone’s home. These companies often are not thought of as heavy hitters in the business word, but research suggests that the stereotype of home-based businesses is wrong. It is estimated that over six million home-based businesses provide over half of their owners’ household income. In total, home based businesses create one in ten private-sector jobs, so much so that the term “homepreneurs” has been coined for these business owners. Many home-based businesses are offering commercial-spaced businesses an aggressive counterpart. And business owners who in the past felt compelled to rent an office space in order to be taken seriously are finding that the trend toward wide acceptance and legitimacy of home-based businesses is becoming more commonplace.
1. Get organized.
Organize your home office logically. If you sell clothing, there should be a shoe section, a casual wear section, an outerwear section in your home office and so on, just like you see at your local Wal-Mart. The last thing you want is a mish-mash of office products and computers all stacked up on your desk. Create a simple organization system as part of your office routine so you can easily and quickly find items you are looking for without a long, drawn out search. When working from home, you ideally should have a separate space for your office. If an entire room isn’t possible, create boundaries for a work area with partitions or drapes.
2. Join the Better Business Bureau.
Instead of spending all that money renting an office space, consider joining the Better Business Bureau. For less than $500 a year, a small business can build credibility. The Better Business Bureau web site is a directory of businesses who have taken high company ethics and corporate culture seriously. By joining the BBB, your business web site can be listed in the BBB business directory. And the BBB provides emblems that you can put on your company web site with an “accreditation score”. The happier your clients are, the higher your score is. Many customers look for businesses with a perfect A+ score.
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3. Keep your operating costs low.
By officing out of your home, you have the competitive advantage of lower expenses. So don’t blow that advantage by purchasing expensive desks or equipment that is not needed. Remember, you are competing against brick-and-mortar businesses, so you need to keep your expenses down and hang on to your low-expense advantage. Home-based ventures are able to offer products and services at a lower cost while business owners are able to retain a greater share of their total receipts.
4. Look like a professional.
Look like a pro. You’ll want to have a professional-looking web site with a domain name that corresponds with the name of your business. For example, if you are web site design firm, choose a domain name that has keywords in the name, such as JoesDesignFirm.com. Choose a professional web hosting firm, preferably one that is environmentally friendly. If you select a green web hosting provider, you can put a “green” emblem on your site announcing your site’s eco-friendly status and visitors will take note of this extra effort that your business has taken. Also, your business cards and stationery should be on a par with what a large company would use. You can order these supplies quickly and economically at VistaPrint or 123Print.com, to name just a couple of places.
5. Consider installing a separate phone line.
A separate phone line may be important so that your phone calls can be answered as professionally as possible, without children crying or dogs barking in the background. Also consider opting for a higher-quality voice-mail system instead of a regular old answering machine. Many small business owners have chosen a VOIP PBX hosted phone system to make their small business sound big. With professionally recorded greetings, voice mail to email, and unlimited extensions, business owners are able to sound professional, remain connected while away from the “office” and create extensions for part-time employees. Also handy is the ability to forward extensions to off-site locations.
6. Pay estimated taxes four times a year.
To avoid an unexpected doozy of a tax bill after you strike out on your own, get in the habit of filing estimated tax payments by the deadlines established by the IRS. For information, go to the IRS home page and search for “estimated taxes.”
7. Save for retirement.
This may seem like a low priority when you’re struggling to get a business up and running, but it’s important to set aside at least some money for retirement each month. One relatively easy way to do this is to open a simplified employee pension individual retirement account, or SEP IRA.
8. Be sure you have enough insurance.
You will need health insurance for yourself and your family and liability insurance for your business. A good way to find relatively reasonable health coverage is through a business or trade organization in your field. At the very least, secure a low-cost catastrophic health insurance plan with a deductible of $2,000 or more.
9. Set goals for your day.
As you plan your day, set the goals that you want to accomplish. Although you may not get through your entire to-do list, try to set and meet reasonable goals each day. Remind your children that just because you are working out of your house, this does not mean that you are on vacation. Set boundaries and stick by them. Your family must respect your work-schedule in order for you to be successful.
10. Don’t let yourself get overly stressed.
Never, ever give up. But at the same time, recognize when you are getting overly stressed. If this happens, take a twenty minute break. Walk the dog around the block. Get a snack. Take a break. Having a home business has many advantages and benefits, but it can also be overwhelming and challenging to manage it all.
Small home-based businesses becoming more popular.
Small home-based enterprises will play an even larger role in the economy over the next twenty to thirty years. We could very well see the percentage of people who are self-employed and work from home double.
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Finally, one bonus tip that applies to your company architecture and sales techniques: it’s better to be clear than clever. Think about that.