Lay The Right Foundation For Your Home Based Business

Published August 21st, 2008

by Stewart Woyo

Operating your own home-based business is one of the most satisfying ways to work. That is, provided that you do your research ahead of time and lay the proper foundation. Most people think that starting a home-based business is convenient and easy. They’re right in that it is usually convenient. But as for easy? It couldn’t be farther from the truth. Starting up a home business takes a lot of work, but if you do your homework you can navigate around many of the common pitfalls of beginning a home business of your own.

First things first. What product or service are you going to offer that your target audience can’t live with out? This is important folks, because no matter how much you love a widget, if your customer thinks they can easily live without a widget, your business is going to be slow, maybe non-existent. You have to have a product or service that can sell.

Second you will have to decide the location of your office. Whether it is in the family room, living room, or your own office, it should be somewhere where you have enough space so that you are not crowded. Make sure it won’t get in your families way so that they can continue in their lives without disturbing your business while you are working. Do your own homework on the tax laws and find out how much space you can write off for business use in your house. Also you have to call the zoning board to find out what kinds of permits you will need to get your business started. Most of this information can be found on the internet so just do your research and you will be working optimally.

Now you have your permits and you know what you are going to sell, next make sure you know what you must charge to make a profit. Many home based business owners make the mistake of thinking they don’t have much overhead so they price the product on the low side. Make a list of everything from a percentage of the mortgage payment and taxes to the cost of the hour you take to clean the office once every few weeks. Figure in utilities (don’t forget the extra phone, fax and internet services you will need), furnishings, office supplies and equipment, even the cost of maintaining your drive way if clients will park there. Usually, the over head in a home based business is higher than you think. Price accordingly.

OK, now you are set for business, what are your hours going to be? You may think working at home means you can work any hours, but in fact it’s not true. How can you work late at night if your average customer does business from 9 to 5? You can’t. Your business hours must be convenient for your customers and, if you really want to be successful, your hours should be the same every week. Your customers want to feel confident that they can reach you when they need to. It’s okay to switch on the answering machine while you are out to lunch (OK, Not out, but in the kitchen), it’s probably not going to increase business if you switch on the answering machine while you go work in the yard because business is slow.

Now, tell me how your family is going to respect your business hours and not bother you while you work. Good Luck. I know it can be done, but you will have to communicate well with your family about what is acceptable and what is not. Some home business owners have a suite with a separate entrance that is not connected to the inside of the house. This works well, the family has to go outside and knock on the door to speak with the business owner during work hours. However you achieve it, the understanding must be clear that when you are working, you are working.

Last but not least, have a back up plan for what you will do when your successful business out grows your home office. When will you have to hire an assistant to help with the administrative tasks? How will you accommodate growth? When will you know it is time to move to a commercial space? How will you make the move with out disruption of your business? Just a semi-lucid plan B in the back of your mind will do for now. As your business grows you can solidify your plan and be ready if and when the day comes.

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