7 Tips on Successfully Running a Home-Based Business
Running a home-based business comes with many benefits, like flexibility, the ability to create your own schedule and even tax breaks. These benefits are hard to beat, but it can be difficult to grow your home-based business.
However, being home-based doesn’t mean “staying small” or limiting your opportunities. In fact, some of the most well-known companies in the world -- like Apple, Hershey’s and Ford Motor Company -- started as home-based businesses. Furthermore, 69% of entrepreneurs start their businesses out of their homes.
If you have big aspirations and are looking for ways to turn your great idea into a tangible business model that’s run out of your home, you need a plan. Consider the following tips for starting and running a home-based business:
Related: How to Keep Your Employees Motivated
1. Evaluate your space
Running a business out of your home doesn’t mean your home is an ideal location. It might be, but you might need to adjust. Think about your current living space and compare it with the business model you have in mind. If you need to be able to meet with customers or employees, can you comfortably make that happen in your home? Are you easy to find? Do you have adequate parking?
Additionally, look into whether zoning and permit laws in your current location prohibit business or certain types of business. If there are any hold-ups during this evaluation, moving to a home that’s more suited for running a business and living comfortably at the same time might be a good first step.
2. Stock up and set up
Once you’re sure your home is ready for business, it’s time to focus in on your actual office space. First, be sure you have a dedicated area that’s appropriate for doing business. Your home may be equipped with an office. If not, consider portioning off a specific area of a larger room, turning a large closet into an office or even weatherproofing to convert a garage into your dream office.
Also, think about the supplies you’ll need to do business. Everything from furniture to offices supplies should be considered as you budget your start-up expenses. Examine what you’ll need going forward and look for ways to save. Services like Amazon’s Subscribe and Save allow business owners to save certain percentages on ongoing purchases, which could free up a considerable amount of money in the long-run.
While stocking up, consider your brand. Personal branding is just as important for home-based businesses as it is for large corporations. Look at investing in marketing materials that carry your logo and creating a website that does the same. Consult with a designer if you’re unsure of where to start.
3. Set a schedule
You may be dreaming about the flexibility you’ll soon have at your fingertips, but if your business is going to be profitable, it will require work. To set your schedule, consider:
- How many hours per day you’ll need to get your business off and running.
- What your current schedule looks like — what can you reorganize, and what will you need to plan around?
- When you work best. Are you a morning person or a night owl? When are you most efficient and focused? For most adults, the answer to this question is during the late morning. Plan to work during your most productive hours.
- When your customers and business partners are available. If you work best at midnight, but you need to be able to contact customers or key business partners during normal working hours, it may be difficult.
Once you’ve considered all of the important factors listed above, create an actual schedule. Mark it on your calendar and share it with your family and friends. Understanding that you’re actually working, even though you’re at home, is beneficial for everyone.
4. Get your books straight from day one
Here’s the thing. Running a business out of your home comes with many tax benefits. However, there are still penalties for failing to comply with tax laws and failing to report proper income levels. To avoid this, consider investing in comprehensive tax software from the beginning stages of your business to keep your books straight, or start working with a tax accountant. Ensuring your operations are in concordance with IRS regulations will protect your business in the future.
Related: The Secret to Productivity: Focus
5. Consult with a business attorney
Just like IRS regulations, there are many laws that apply to home-based businesses. This is especially true if you’ll be using contractors or hiring employees. One misstep or oversight could ruin your business. Consider searching for a reliable business law attorney in your area and set up a consultation. An attorney can help with:
- Setting up the proper structure — LLC, corporation, partnership or another option.
- Ensuring you have the proper paperwork on file for each employee.
- Determining whether someone should be considered a contractor or employee.
- Asking the right questions and providing input to ensure you move forward according to the law.
6. Keep your personal life separate
When you work from an actual office space, it’s easy to leave work at work. You may think about it after hours, but everything you need to do your job is at the office. When you work from home, it’s much easier to blur that line. Remember that you have a set schedule. Things may come up unexpectedly, but try to find a way to stay away from your office space when you’re not working. This is critical for your mental health and happiness — and that of your family, too.
7. Create a network
When you work from home, you likely spend most of your time on your own. This can lead to negative emotional and psychological consequences, especially for entrepreneurs who thrive on being out and around others.
To combat this, consider looking into local, professional organizations. Find something up your alley and go to a meeting. If it’s a good fit, become a member. Make an effort to attend social events to learn more about your industry and to connect with people in the field. This might provide the social energy you need to thrive, and it’s another important aspect of creating a personal brand that’s recognized by others.
Running a home-based business is an exciting prospect, but it’s going to need some work. To ensure you get started on the right foot and prosper going forward, consider the seven tips above and jump in. Big things could be right around the corner.