You've got an idea for a winner of a home-based business, and you're about ready to announce it to the world. Good for you. I certainly don't want to delay you from joining the millions of people now running viable businesses from the comfort of their own homes. But take a moment to read this checklist. It's the 10 things you need — besides customers — to start your home business off on the right foot.
1. First and foremost, a market for your product or services. If you haven't done any homework on this, go no further. "This is a critical first step, and it is amazing how many people set up a business without having a market for it," says Jane Applegate, nationally known small-business author and advice columnist. Even "verbal" market research can clear up a lot of questions, she says. "If you want to do cake decorating at home, talk to 50 people you know and see if they would buy from you. Talk to people at your church. Make sure there are people who want to buy what you have to sell."
2. A separate space for your office. Yes, a separate room in your house would be nice. No, it is not mandatory. But you do need an area that is distinctly your workspace, and can be closed off from the rest of the house by partitions, dividers, drapes, even a shower curtain, if that is all you have. "You really need some sort of boundary," Applegate says, "so that on one side you can say, 'This is my business,' and on the other, 'This is my life.' " Don't use your dining room table as a desk, advises Jeff Berner, an author and consultant who has worked out of his home for more than 35 years. "You'll never get it back to eat on." Ah, but if you rarely use your dining room table for dining, go for it, counters Lisa Kanarek, a home-office expert and organizational guru. "I converted our dining room, took out the chandelier and put French doors around it for my office," she says.
3. An ergonomically sound workstation to go with your PC or laptop. If you are Azriela Jaffe, a noted author and writer on home-business psychology, you might spend nearly as much money on a comfortable chair as you would on your computer. "Years of sitting on the wrong chair can leave you with disabilities and poor posture," she says. "I think it is worth the investment to spend $750 on a chair." Jaffe feels similarly about her mouse. "You need a mouse that doesn't stress out your wrist. Your basic cheap-o mouse won't work." PC or laptop? Suit yourself. Today's laptops offer many of the same features as a PC, and greater mobility. You are subjected to a smaller keyboard and, in many cases, a touch pad instead of a mouse. But if you travel or are outside of your office a lot, a laptop may be the way to go. If you can afford it, it may be worth having both a laptop and desktop PC.
4. A separate phone line — or two — and a decent modem. Your customers will appreciate their calls being answered by you, your assistant or a professional-sounding voice-mail message — not your young child, with the dog barking in the background. A separate phone line for your business is a must, and another line for online access is highly recommended. Get a voice-mail system too, rather than an answering machine, says Applegate, because the recordings are better quality and the system is more reliable. Do you need a high-speed DSL or cable modem? Absolutely, most home-biz pros will tell you. "It depends on what your time is worth," says Kanarek. "If you spend all day on the Internet, it may be worth it to you to invest in DSL."
5. A separate bank account. While not legally required for tax purposes, this is important, because you never want to mix your business money with your personal money. Having a bank account in your business's name is the way to go, Applegate says. She also recommends a finance software program such as Microsoft Money to keep track of your business finances.
6. A business license and federal tax ID number. Your city or county may or may not require you to have a business license; it varies per jurisdiction. Contact your local governments to find out. Many large companies will want to see a business license before they do business with you, Applegate says. Getting a tax identification number is a must. Get one from the IRS.
7. A Web site and e-mail account in your business's name. Yes, you need a Web site, for business and marketing purposes. And you want a Web domain name that matches the name of your business's name — not some complicated slash-tilde gibberish that no one can remember. Same thing with your e-mail address — an account with an Internet service provider (yourname@yahoo.com) won't do here. Not only do you want to sound professional; you also must promote your brand. "My Web site definitely helps my business," says Kanarek, who runs HomeOfficeLife.com out of her Dallas home. "I get e-mail from around the world from it. It is probably the best marketing tool I have." 8. Business cards, stationery and, yes, a fax machine. Are fax machines obsolete? "Becoming so," says Applegate, "but you still need some sort of faxing capability." She prefers faxing software, so that you can send faxes through your computer. Jeff Berner would rather have a regular fax machine, so he doesn't have to scan documents into his PC to fax. Both like the idea of a pricier fax copier-scanner machine in addition to your PC. 9. Health and liability insurance. If you quit your other job to do this full-time, you're on your own now. You won't have paid sick days. You don't have paid vacations. And you're responsible for acquiring your own health coverage. Health insurance is probably the biggest thorn in the sides of small-business owners; it's expensive and sometimes hard to get. One of the best ways to get health insurance is through business or trade organizations — even your local chamber of commerce may offer a health insurance option. You also need to consider business insurance. 10. Regular business hours, and a life outside your office. For many people, starting a home-based business means blurring the lines between your work life and family life. Veteran home-based business operators say they set regular business hours and stick to them. When they are off work, they shut the doors to their office or close the partition around their workstation, and leave. Likewise, they don't allow children to hang around their workspace when they are trying to get work done. You're kidding yourself if you expect to get a lot accomplished with a baby on your lap. "You have to be disciplined," says Applegate. "You need to tell others in your family, 'Interrupt me only if the house is burning down.'" At the same time, home-based business owners can go too far and isolate themselves from the rest of the world. "Don't cocoon yourself," Berner says. Maintain your network of friends, and find ways to make new ones, he says. "Seek out other independent professionals doing similar work as you are, and form a 'skill guild.' Meet people for lunch as much as possible." Secluding yourself in your office not only ruins your social life, but it's bad for business. By Monte Enbysk
"I don't have time to market." It's a common complaint from self-employed professionals. When you are the only one who can serve the clients, manage the business, and perform all the sales and marketing functions, time becomes the most precious commodity you have. How can you find time for marketing with so many other important priorities? There are many time management techniques at your disposal, of course. You can defer tasks or delegate them, chunk down projects to smaller steps, and set aside time on your calendar for making calls, writing letters, or updating marketing materials. Perhaps you have already tried all those methods and discovered that time is still scarce.
Maybe the real answer is not to find more time for marketing, but to MAKE time. Every day, you take part in many time-consuming activities that don't include marketing.
What if you could integrate marketing with all those things you are already doing? Here are some examples of how that can work:
1. Attending workshops, business mixers, and cultural events. Whenever you plan to attend an event like this, consider inviting a business contact to join you. Just extending the invitation will contribute to building a stronger relationship between you. If your contact decides to attend, you can often get to know each other better in a more relaxed way than meeting one-to-one.
2. Having lunch or coffee with a prospect or colleague. If you are already planning to take time meeting with someone, add a third or fourth person to the party. Those invited will usually appreciate the opportunity to make new contacts themselves, and you may find conversation flows more easily when there is a group.
3. Traveling to another city. Whether you are traveling for business or pleasure, arrange to meet for lunch or dinner with a client or colleague. On a business trip, this is usually much more enjoyable than dining alone. As a tourist, a meal you would be eating anyway takes no time out of your vacation schedule, plus you'll often get local tips about where to go and what to do.
4. Taking a walk, visiting the gym, and other forms of exercise. Meetings with business associates don't have to take place in the office or a restaurant. Invite someone to join you for a walk in the park, run around the track, or a game of tennis. You don't have to learn to play golf in order to get exercise and do business at the same time.
5. Reading an article. Any time you read an interesting article in the newspaper, a magazine, or online, think of three people you could send it to. Writing a short "thought-you-would-be-interested" note and forwarding the item will take only a moment, but can make a big impression on the recipient.
6. Shopping, dining, or running errands. Every time you leave your home or office, you meet new people. They are behind the counter at the office supply store, in line at the coffee shop, sitting at the next table, or shopping in the same aisle. Whenever you find yourself chatting with strangers, remember to introduce yourself by name and occupation. You'll be surprised to discover how often this will lead to a connection that can result in business.
7. Attending social events. The best business relationships often begin casually in social environments. Keep your business cards in your pocket when you attend a wedding, housewarming, holiday party, or your child's soccer game. After you ask, "How do you know our hosts?" or "Which child is yours?" make your next question, "What do you do?"
8. Relaxing. You may have a long list of marketing projects that will take time but not your full attention. Consider doubling up these mundane tasks with a fun activity or some pleasant company. Enter business cards into your contact database on your laptop at the beach. Make phone calls from the hot tub or a park bench. Review your prospect list while watching old movies or listening to music. Ask your kids to help you stuff and address envelopes. Take your project to a friend's house so the two of you can work together on marketing.
As you can see, there are many ways to include marketing activities in your busy life. So instead of wishing you had more time for marketing, why not make marketing a part of the time you are already spending?
By C.J. Hayden
More and more individuals are opting to work from home. According to the latest U.S. Census, nearly 4.2 million people worked from home in 2000; this up from 3.4 million in 1990. The Census estimates are for people who work most days of the week from home. Additionally, there are about 16 million more individuals who also work from home one to two days a week.
Many of these work-at-home individuals are entrepreneurs: The U.S. Department of Labor's Bureau of Labor Statistics reports that in 2004 more than 4.5 million people worked at home with a home-based business, these individuals comprising about 30 percent of the work-at-home population.
The advantages of a home-based business are many and include:
- Zero commuting time and expenses - Lower start-up costs and overhead - Tax benefits - Optimum flexibility and time management - Part or full-time work options - The satisfaction of being your own boss - Greater income potential The reality though of working from home presents a number of new challenges unique to the home-based business owner. Knowing about these potential pratfalls ahead of time can be a key factor in preventing them from becoming a roadblock to your home-based business success.
1. Not keeping business and personal life separateToo many people have learned the hard way that if you commingle business and personal responsibilities at the same time, you won't make any real progress in either.
Family members need to know that your being home does not equate to being at their beck and call 24/7. Frequent interruptions can wreak havoc with performing business tasks efficiently. And when the chores of the household start beckoning, you'll need to be able to resist their call.
If possible, have an entire room of your home set up exclusively for your home business, optimally with an outside separate entrance if business clients or visitors will be coming to call. If not possible, and your home office is part of a larger room, be sure to partition it off with something like a screen or an area rug. Have a dedicated phone line for business use only, and make sure your home-business space has a door to close off any household noise. You may also need to come up with a "signal" so that family members know you literally "mean business." Closing your office door or affixing a sign reading "Hard at work -- Do not Disturb" may be all that's necessary.
And the flexibility afforded by having a home-based business doesn't mean there should be no schedule at all. Yes, it's great that you can adjust your work hours to attend Timmy's kindergarten graduation, but do plan out blocks of time every week devoted exclusively to the business and try to stick to it; i.e. every weekday 9 a.m. to 1 p.m., and 6 to 10 p.m. (i.e., when your spouse can take over care of the kids or household duties).
Remember, treat your home-based business as a "real" professional business and others will follow suit.
2. Not doing something you really like"You have to love what you're doing, because then it won't seem like work to you, and you'll bring the necessary energy to profit from it." Billionaire Entrepreneur Donald Trump
In addition to being good at what you do and fulfilling a real need in the marketplace, you need to have a real passion for what you'll be doing in order to be a success at it. If you don't love what you do, how will you "sell" it to someone else? Enthusiasm is contagious and so is the lack thereof.
Of course passion alone does not a successful business make. Other factors such as sufficient start-up funds, proper planning and management, and understanding cash flow all contribute to the success of your business. But, the ultimate factor in starting your own business should be that it will allow you to earn your living by doing something you truly like or love to do.
If not -- those sometimes-necessary long hours, those ups and downs, and those long trade journals -- may eventually be just too much to bear.
3. Not considering the legalities or protection of your home-based businessOne tax consultant spent thousands of dollars renovating his home for his home-based business. He should have known that in areas zoned as "residential only," restrictions may rule out home businesses that involve the coming and going of customers, clients or employees. Soon after his neighbors became aware of his steady stream of client, their complaints started and then continued. Within months, this tax consultant closed down shop at his home and rented a building for his business on a nearby street zoned for business.
Don't leave yourself open to this type of scenario -- be sure to check with your city and county zoning boards to ascertain how the ordinances in your particular area may affect your home-based business plans. You may find that, for example, that business sign you were planning to hang outside your side door is forbidden, or that it is illegal for you to sell your products on your premises.
Another consideration: Will your homeowner's insurance policy cover the property and liability involved in your home-based business? Be sure to speak with your insurance agent about obtaining the coverage needed for your in-home business; sufficient coverage may be as simple as adding a fairly inexpensive rider to your homeowner's policy.
Like any other business, a crucial element in your home-based business success will be your ability to minimize potential risks.
4. Not charging enoughA college art student started a home-based business selling jewelry made with Swarovski crystals. She based her jewelry prices on what she felt were prices her prospective customers would be willing to pay. While tabulating her receipts for that year's tax returns -- and after countless hours of making her custom-made jewelry -- she was shocked to find that she had actually spent more on crystals and jewelry supplies than she had earned on her finished products. This dean's list student learned the hard way about appropriate pricing.
It's not just students who miscalculate pricing; this is a common mistake many home-based business owners make when setting prices for their products and services. New business owners often charge lower prices initially to drum up business. Then they find themselves in the awkward position of having to boost prices in order to stay in business, while customers' expectations for lower prices have already been set.
Prior to setting prices for products and services, business owners need to determine fair market pricing in their industry, and then establish and maintain an optimum pricing strategy. Pricing items correctly is a key way to: improve short-term cash flow; improve return on investment (ROI); and to manage and maximize profits. And when determining prices, don't forget to factor in the slow times -- every business has them. On the other side of the pricing coin, home-based business owners should periodically compare prices from different suppliers in order to get the best price for their business needs.
Don't forget that incoming revenue is the financial lifeblood and nourishment your home-based business needs to grow and thrive in order to stay alive.
5. Not considering a website Every home-based business should consider a website. For the vast majority, a website can be a powerful and relatively low-cost way to announce a business, its products and services -- and reach prospective customers 24 hours a day. With a new home-based business, you may not want to tackle this right away, but failing to have a website indefinitely may prove to be a critical mistake.Be aware that e-Commerce revenues are on the rise. Statistics from The Census Bureau of the Department of Commerce show total U.S. e-Commerce sales for 2005 at $86.3 billion; up from 15 billion in 1999 when e-Commerce sales were first tracked. Additionally, U.S. e-commerce sales are now 2.7 percent of total retail sales; up from .6 percent of total retail sales in 1999.
Remember, at some point, your home-based business should have a website -- one that is professional looking and well-designed, and one that enables users to easily find out about your business and how to avail themselves of your products and services.
by Patricia Schaefer, www.franchisetrade.com
Referrals are a powerful way to increase your sales, and networking is a proven way to generate referrals for your business. When you reach out to other business owners, you are forging an alliance which can benefit everyone involved. Networking involves meeting with business peers and discussing ways that you can work together to improve sales. For example, if you operate a dry cleaning store, you can begin networking with local clothing retailers. They can provide referrals for your service and, in turn, you can refer your existing customers to these retailers when your clients need to purchase new clothes.
You can join local business organizations to meet other business owners who are looking for the exact same thing you are: more business. By banding together and offering referrals, everyone benefits.
If you cannot find any suitable networking organizations, you can create your own by contacting businesses in your area that share your interest in networking. You will have the added bonus of making new contacts as you form your organization.
In addition, there are also several national networking organizations that utilize the power of the Internet to increase referrals and bring many companies together.
Here are ten tips to becoming a successful networker.
1. Set your networking goals. What do you hope to achieve by networking with your peers? More sales, more customer leads, or just helpful information? Setting your goals now will help you focus your networking efforts.
2. Join existing networking groups. There is power in numbers -- and that certainly applies to networking. By becoming a member of several groups, you can ensure that you will be creating more opportunities for your business.
3. Become a volunteer. If you have extra time, you can volunteer for local or state events. As you get yourself out in the public eye, your company will become more visible.
4. Get informed ahead of time. The more you know, the more your peers will be drawn to you. Make sure that you are prepared before joining a networking group or attending an event.
5. Be sincere. Don't say things you don't mean or make offers you have no intention of keeping. In networking, as in business in general, maintaining your reputation is critical. If you are disingenuous, your peers will eventually find out, and word will get around.
6. Work on your communication skills. You will need to be able to state clearly what you are looking for when you are networking. This way, your peers will be able to provide you with the help that you need.
7. Learn to share. If something has worked for you in the past, do not keep it a secret. Sharing your successes -- and even your failures -- with your peers will build relationships and gain you even more networking partners.
8. Work on your follow-through. Many busy business owners get caught up and forget to follow through on networking promises. Don't disappoint your new networking associates. Follow through if you want to receive good referrals from your peers.
9. Word your questions carefully. When you are asking questions at a networking event, try to make them open-ended. This will result in better responses.
10. Be indispensable. If you have a great deal of knowledge, you can become a networking resource on your own. By sharing your knowledge, you will be gaining more potential referrals and more networking partners.
By AllBusiness.com
One of the books that I really found useful to guide your home or small business is Guerrilla Marketing. Not only this book gave a lot of inspirations, also that it can be easily used. This is what I got fro amazon.com.
Editorial Reviews
Review
The Los Angeles Times: "No matter what business you're in, Guerrilla Marketing, the bible of lively, low-cost marketing tips, is invaluable."
Review
"No matter what business you're in, Guerrilla Marketing, the bible of lively, low-cost marketing tips, is invaluable."
Book Description
When Guerrilla Marketing was first published in 1983, Jay Levinson revolutionalized marketing strategies for the small-business owner with his take-no-prisoners approach to finding clients. Filled with hundreds of solid ideas that really work, Levinson's philosophy has given birth to a new way of learning about market share and how to gain it.
In this completely revised and expanded third edition, Levinson offers a new arsenal of weaponry for small-business success in the next century. Filled with strategies for marketing on the Internet (explaining when and precisely how to use it), tips for putting other new technologies to work, programs for targeting prospects and cultivating repeat and referral business, and management lessons in the age of telecommuting and freelance employees, this book will be the entrepreneur's marketing bible in the twenty-first century.
About the Author
Jay Conrad Levinson, president of Guerrilla Marketing International, lecturers around the world on guerrilla business techniques for majors companies, professional organizations, and universities. He is the author or coauthor of eleven books in the Guerrilla Marketing series and write the popular "'Guerrilla Entrepreneur"' column for Entrepreneur magazine. The author currently lives in California.
You've got an idea for a winner of a home-based business, and you're about ready to announce it to the world. Good for you. 
