Starting a business

Tuesday, 17 April 2007

Starting a Home Business

By Jan

Anybody can start a home based business. You have seen people done it with little or no capital, but with grit and determination, made the business grow. Do you envy them? Perhaps you do. The dollar sign floating in front of your face is good enticement for you to think of something to start up a home business.

But be forewarned! Starting your own home business can be tough, time consuming and risky too. Many new businesses, up to 70% of new start ups do fold up within the first two years. What!? I'm not trying to scare you off in trying your hand at starting up a home business. But what you need to know is you have to be careful in running a business. As long as you make sure your cash flow is running smoothly, you can remain to stay afloat. Having no debt would lift your burden, but if you can use other people's money to run a business, you would need to cough up your initial sum.

However if your home business did fail the first time round, take heart that many successful people has started a business, became bankrupt and somehow found a way to regenerate the income to pay back the loss in a short time. A lesson learned in failure should not become a stumbling block to start another one. Consider it as a temporary defeat, a lesson learned, but never once bitten twice shy.

Education a Prerequisite?

Do you need to have tertiary education to get ahead in starting a business? Not really. Although a tertiary education would help you understand the concept of running the business, it is by no means giving you an advantage over others who may lack the knowledge. A tertiary education does not give you the necessary street smart knowledge of running a business. It some ways it might even hamper your ability to start up a business.

This reminds me of a joke, so what does PhD stands for? No, it is not the title of a Professor or a status of achieving an academic Doctorate qualification. It is when you have learned so much that you get a "Permanent Head Damage!"

Ok, I may be going too far on this; this is not to say that having a University degree is not a good thing. A tertiary education on business does give you a broad understanding of how a business should be run. But in reality one needs a certain creativity and experience to ensure that a business will be run profitability if not at least on a breakeven point. The Good and the Bad of Running a Home Business

A home business is running on lean, and there are cost advantages to start a business at home. You don't have to rent an office space, you can just start your home business in your kitchen's dining table, or set aside a small room with a desk, phone and computer equipment for running your home based business. Or even set up one in your garage. Whichever you feel the most comfortable or convenient to start up a work at home business.

You save time by not having to spend hours daily commuting to work. Those hours saved can be used for running your business. Imagine the man hours lost commuting from house to office location, multiply the lost hour with each person and by the number of days and you can see how much lost productivity time a whole nation faced from the commuting time! Not to mention the contribution of green house gas emission from vehicles stuck in a traffic jam! Talk about lost time, lost energy and deterioration of the environment!

By being at home, you could also keep an eye out on your little ones and save on nanny fees. In fact some people want to work at home is just so they can take care of their children, to be at a moment's notice for any emergencies.

The above explanation may look rosy but there is a downside to working at home. A home environment has too many distractions, it is very cozy; you will need to discipline yourself to keep your mind on your task at hand and not to get side track doing other non-essential things. Children can be very interruptive and you might lose your train of thought while doing your work. If you can overcome all this and manage yourself effectively juggling the various hats you have to undertake in the day to day running of your affairs, then doing a home business is for you.

Part Time vs. Full Time

Doing a home business can take two forms, running it part time or on a full time basis. Each has its own pros and cons. If you are not so sure whether what you do will actually net you any result, then do it part time. As your experience grows and the cash starts to flow in, then you can consider doing it full time. But the drawback of doing it part time means you have to sacrifice your resting time at night, maybe get by with less sleep, forego many of the luxuries that you have been enjoying before starting on your home business part time. Some luxuries are easily let go, like for me, I stopped watching the TV. Spending hours looking at some dumb show is just a waste of time. Forget about Desperate Housewife or Lost. Sure they are award winning TV series, but when you watch the shows, you are wasting your time. Though you can give yourself a treat once in a while just to clear your mind watching mindless at some TV shows; make it a habit to make yourself desperate for your home business success and to ensure the business does not become lost!

And for those who are very sure of their abilities, by all means jump in and do it full time. You can actually achieve much more by going at it full steam than on a part time basis. Because your entire income depends solely on you making the business work, a survivalist attitude takes over you mentally as you give your all to make your home business successful.

Because it is difficult to start a business from scratch; you will need to know your existing finances is sufficient to carry you through as you work your way to make your business venture running smoothly. Preparation to Start a Home Business

If you are currently still holding a job, and you have decided in your heart that starting your own business is the way to go. Do make some kind of preparation for the transition from your usual job to that of a home based business.

1. Finances - you should have been diligently putting aside a portion of your income ever since you started on your first job. If you have not done so already, you should. Don't tell me you are up to your necks with bill payments, mortgages and installment loans! If you have not been carefully managing your finance when you are having a full time job, imagine how much more difficult when you are on your own. You can actually live on less by adjusting your lifestyle and eliminating the non-essential stuff from your life. Later when your home business becomes better, then give yourself a treat.

2. What type of business to do - you can draw on your experience and do a similar kind of work as your job. After all, you had been at it for years. You have the experience, the contacts, the know-how. It is just a matter of shifting your job style from that of an employee to being your own boss doing the same thing. But if you hate your job, and looking for something that you have a passion in it, then by all means go for it. You probably know a lot about the subject and you could probably make an income on what you know passionately. And lastly, if you are the aimless one, living your life according to how the wind blows, then you will need to concentrate your efforts and do a little more research on what you could possibly do.

3. Mental preparation - You will need to prepare yourself mentally and resolve to forge on ahead despite the fact that you will meet with many hurdles and stumbling block even before you start your home business. You need to overcome the pessimism, the negative voice in your head, and even an unsupportive spouse and family. You will need to tell yourself you can do it, and you can make it a success. Having a dogged determination will win you many battles. This I believe will be the most important preparation to start up a home based business and make it a success.

So are you ready to take the step? Take some time to explore your options and make a wise decision with the information at hand. You don't have to wait till you have all the information before making any decision; it may lead to your inability to sort out the sea of data. In this case it may just be better to just jump right on in and learn along the way. That's the beauty of starting up something small, because your capital investment will be lower, and thus your risk is smaller. You may still have enough yet to try something different. And as your entrepreneur spirit becomes more voracious in accordance to your ability, you may tackle something with bigger rewards.

So I leave you here to ponder your options and the next step in taking up a home based business.

About the author

Jan has taken up the challenge of starting a home based business using online tools like Site Build It! If you have the passion and determination you too can be successful!