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10 Must-Know Tips and Techniques for Starting a Home Business
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Are you tired of the day-to-day corporate grind? Maybe you’re a stay-at-home-mom or dad who wants to enjoy your children while bringing home the bacon. Whatever your reasons for wanting to start a home business, you should be aware that as many as 60% of all new home businesses go under in the first year. Another 20% make it less than five years.
Why the problem? Because new home-based business owners don’t take the time to get started on the right foot and without some planning, you could undercut your business before it gets off the ground. If you’re thinking of – congratulations – this is the first step toward independence and self-sufficiency. With these 10 must-know tips and techniques, you’ll have the best shot at making your business a success. starting a home business
1. Assess Your Home and Lifestyle
Imagine working at your home business a minimum of eight hours a day. Can you do it? Are you suited to the task and can you motivate yourself to work without someone looking over your shoulder? Running a successful home business means you’ll be more isolated. You must be well-organized, able to set goals and do all the little tasks associated with your business. You must be motivated, disciplined and persistent and you must be prepared to survive on a lower wage until you build up your business. If you need constant reassurance from others or you are easily discouraged – you might be more happy working for someone else.
Do Your Research
2. Start-Up Checklist
- Do you need a permit or license to operate your home-based business?
- Do others make sufficient money offering the same services you want to offer?
- Is there a need for your service in your community or can you work online?
- If your business is successful, will you open a storefront?
- Is your home suitable for running the business?
- Do you have enough savings to live on until your business shows a profit?
- Have you decided on a business name?
- Will your business be a sole proprietorship or a LLC?
- How many hours can you devote to running your new home business?
- Will you start up on your own or purchase a franchise?
Going through every item on this checklist and thinking over each one carefully will allow you to determine some of the hidden aspects of going into business for yourself, so you don’t run into surprised down the road.
3. Getting Your Workspace Ready
Your office is where you will conduct your business and where you will file tax information, client records and other business-related material. If all you have is a corner of a bedroom – make it count. Organize your office so you have good lighting while you work and include adequate storage shelves, drawers, file cabinets or boxes to organize all your papers. Even if your office is in the laundry room – make it pleasing. Hang some posters, add a plush rug, a comfortable chair and a potted plant to make it more encouraging to work there. Use splashes of your favorite colors so you feel upbeat and motivated. Keep clutter to a minimum.
A good business plan is essential.
Turning a profit involves a delicate balance between setting a high enough price for your services or products without pricing yourself out of the market. If your clients will pay $20 for a hand-crafted pot, but you can only make one pot every two hours, the most you can make is $10 per hour for your time. That’s assuming that all your pots sell promptly. If you raise the price of your pots to $50 apiece you might lose some customers who were comfortable with paying only $20. In addition, you must subtract the cost of materials you purchase to make the pots. Do some math and figure out what you can offer your products or services for and make enough money to stay in business.
Because paying income taxes is an inescapable fact of running a business, one of your first steps should be to retain an accountant that can help you determine how much money you must pay into the government quarterly to meet your tax liabilities. Your chances of running a successful business without professional accounting advice are much less than if you consult an accountant. It’s money well spent!
Branding Your Business
5. Creating Your Business Image
No matter what home business you start – your professional image is crucial. You have to impart a sense of knowledge, quality and attention to detail. In the end – the quality of your products or services will determine whether your business is a success, but small things can help you get established along the way. Order business cards and letterhead stationery. Decide on a Code of Ethics in dealing with your customers. You should strive for courtesy, consideration and respect in your dealings with others. Promptness is essential. Meet your deadlines…every time and don’t take on more work than you can finish successfully in the allotted timespan.
6. Getting the Word Out
How will potential clients know about your new business? You can create a great workspace and have a super product, but if no one knows about it – you’re sunk. Nearly all successful businesses today have a web presence. If designing a website isn’t in your repertoire, hire someone to do it for you. Send out mailings to potential clients, buy ads in the local newspaper and follow up with personal phone calls. Offer incentives, attend tradeshows, and join professional associations with like-minded business associates to make contacts and network. To start – count on spending at least one hour per work day on marketing your new business.
Schedule in Some Relaxation
7. Don't Burn the Candle at Both Ends
All work and no play not only make you dull – they can take a toll on your health and mental attitude. While you’re setting appointments, producing your products and meeting clients, set aside time each week to spend with your family or to take part in other recreation. This isn’t a luxury – it’s a necessity! Not making some time for you can result in frustration and burnout. If you want to be a successful home business owner, schedule in things like a monthly massage, a daily walk in the park, taking the kids to the zoo, having lunch with old friends, seeing a movie or planning a movie night with your significant other. Don’t skimp on personal time or you could become resentful of your new business.
8. Ongoing Education in Your Field
Once you start your home based business, it can be tempting to keep doing only what you’re doing and never expand or change. After all, if it ain’t broke – why fix it? The problem with that attitude is that the world is constantly in a state of progression and unless you keep up – you could be left behind. That doesn’t mean you have to change a product that’s working out well for you, but keep your eyes always open and focused forward so you can take advantage of new opportunities. If you make baked goods, join a culinary pasty club or take an annual class on new ingredients and methodology. Adding to your knowledge is always a good thing.
Tech Savvy Test
What's your tech savvy level?
9. Stay on the Cutting Edge
When you can no longer offer the best product or service in your field, you clients (yes, even the loyal ones) will start shopping around. Earlier we talked about how the internet is an essential part of any new business, but technology changes rapidly. Make sure potential clients have a variety of ways to contact you – by email – by regular mail – or by phone. For important customers, invite them to send a text message the next time they’re in the market for your services. And don’t forget to use the same technology to touch base with them. Don’t spam your clients or you’ll be out of business so fast your head will spin. But send an occasional postcard or email when you’re offering a cut rate on your services or when you’re having a sale. Use the technology your clients use and you’ll stay at the top of their lists.
10. Hire Some Help
One of the main reasons for starting a home-based business is to make money on your own terms, but once you develop a clientele, you might find yourself working much more than you anticipated just to keep them happy. When this happens – congratulate yourself – you’re on the right track. Then, start thinking about hiring someone. The best part about hiring a worker is that not only will you still make your wages for what YOU produce, you can make a profit on what your worker produces. Before you take this step, talk to your accountant about payroll withholding and benefits for your employee, because the govt. is strict about what you must pay in. Together, with your accountant, you can determine how much you can pay an employee and still make some additional money.