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