Starting a Home-Based Business - Checklist to Consider

A home-based business has both its advantages and disadvantages. Here are some important things to consider before you decide to take the plunge.

by Elena Fawkner

Starting a home-based business can be an exciting part of one's life. However, many people take the plunge without doing proper research and evaluating its pros and cons. The result is frustration and misery for both the owner and his/her family. Here are some aspects that you should take into consideration before starting a home-based business:

1. Adequate Resources

Do you have sufficient funds and resources to support your business during its initial phase? Do you work on your business part-time while still continuing your full-time day job until the income from your business can sustain your family's needs. Never ever quit your day job until you have positive replies to above questions.

2. Business Permits

Does your business conform to your local zoning regulations and have you obtained necessary permits and registered your business? If you expect your customers to visit your home office, these aspects are very essential for legal and insurance grounds.

3. Various Insurances

If you business involves visits from your customers, have you taken insurance against any injury that might cause to them. Unless you notify your policy insurance company that you are operating a business from your home and request endorsement of your policy against this risk, a regular home owner's policy will not cover business visitors.

In all other circumstances you must ensure a separate policy to cover your customers. If you are conducting your business illegally, your insurance company might refuse to cover you. Hence it's very essential to obtain all permits and register your business by making sure it conforms to your zoning regulations.

Two more types of insurances you must consider are public risk insurance and income protection insurance. The first one is to cover you in case of any negligence from your side in dealing with other people. If you have made the switch from paid employment to self-employment, you might miss out benefits like disability or income protection insurance that accompanied your job. The second policy is to cover you against this.

4. Miscellaneous Benefits

Again, you also would have left medical, optical and dental benefits along with your job. You must take care to get extra cover to cover these expenses.

5. Tax and Bookkeeping Assistance

Make sure to get early assistance on taxes and accounting, preferably before you take the plunge. Early counseling will help you plan the most tax-friendly structure and the deductions you can claim against your business. Early counseling also helps you to maintain appropriate records and also to decide whether to rent out or purchase capital equipments like PC, printers, and fax machines.

6. Effective Time Management

Once you start you home-based business, you'll face all sort of new challenges and distractions that you were unaware in your regular day job. Maintenance of discipline and schedule is absolutely vital to the success of your business. You may have to decide beforehand when exactly your working hours will be and when you need to do other non-business chores. It may not be like you expected. For example, you may find it difficult to work from 4:00 pm to 8:00 pm when kids will return home from school and go to bed. You may have to schedule less important or non-business activities during this period.

Although working from home can be a wonderful journey, improper planning and analysis can ruin your business and take you away from success. Thorough research, planning and self-discipline are vital to the success of your home-based business.



About the author:

Elena Fawkner is editor of A Home-Based Business Online ... practical ideas, resources and strategies for your home-based or online business. http://www.ahbbo.com

Starting a Home Based Business

Like in starting any business, a home-based business carries with it certain requirements and prerequisites that you must fulfill for long term success.

More and more people everyday are thinking about possibilities of starting their own business from home. For one, it provides for flexibility of schedule, enabling you to schedule your working hours according to your convenience; and also the independence of being your own boss. However, before taking the plunge one must carefully analyze both its advantages and disadvantages. It's not all bed of roses and down the line you wouldn't want to regret your decision. Here are some factors to consider before you take the plunge:

1) Adequate Financial Resources. Due you have sufficient resources to fund your venture in its initial stages. Be aware that some businesses can take years to make profit and your resources must last that period. In case of crisis, will your friends or relatives assist you financially? You may also have to consider the likelihood of continuing your day job and do your business part-time until you start seeing success.

2) Adjusting Family. Does your family support your idea and share your vision? In the early stages, you may have to work endlessly for hours together and your family might feel neglected. Are they aware of this fact? Do you have demanding kids? If yes, then it may get difficult for you to share your time between them and your work. Family support is very vital for the success of your business.

3) Dedicate Space and Communication Line. Can you dedicate a separate room for your office? If you have lot of distractions in your home like pets, small kids, frequent visitors, you need a separate office space to work efficiently. Even your garage space might work for this purpose.

You will also need a separate phone line, fax for your business purpose. Have you or can you make necessary arrangements for them?

4) Your Personality. Are you self-motivated? Do you have the self-discipline to work without any supervision? Can you handle isolation? Can you handle stressful situations? Can you handle added responsibilities?

Running your home-based business is completely different from working under someone. You must have the necessary motivation and zeal to carry one with your business no matter what. Like in your boss's office, you won't have anybody now to poke you often to get going.

One of the biggest disadvantages to running a home-based business is isolation. If you are an extrovert and constantly like company of others, this may seem like an alien world to you. You may have to schedule your work hours in such a way that you get sufficient time everyday for social outings. If this is not taken care off, things might get worse and may also cause depression.

You must be aware that in a business, you alone are to entirely blame for the success and failure of your business. You will also encounter many unforeseen and stressful circumstances. Unlike in your day job, now you wouldn't have the comfort of discussing appropriate course of action with your colleagues. You must have the entrepreneurial instinct in you to take charge of things without anybody's counsel.

In addition to home responsibilities, you now have the added responsibilities of your business. You cannot shut yourself off from either and must be able to perform both duties equally efficiently.

Like you can see, though a rewarding career, a home-based business does have its share of disadvantages. Don't take any decision on impulse. A patient, careful, and systematic approach is of utmost importance before you take any decision that will affect you as well as your family.

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