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5 Tips to Consider Before Beginning a Home-Based Business

Rebecca Black presenting a workshop
How I Survive as a Small Business Owner

When I began my business in the early '90s, I was fortunate.  I didn't need to turn a profit, as I had just retired from a teaching career.  My business was all about having fun while helping others.  However, since I ran a family business as a child, the businessperson in me wouldn't allow me to ignore running my baby as a real company. 

What follows is my advice to all those considering entering the home-based business field.

Do you have enough money to survive two years?

Many people think that just because they are working from home, expenses will be lower than if in a store-front business.  For the most part, this is true.  A home office isn't additional rent.  However, it is still an office and you will still require a paycheck.

Treat this as any other business and ensure that you have enough money to live on for at least two years without considering any profits from your future business. 

Watch your expenses!

In my opinion, the biggest small-business killer is overhead.  Thus, it is crucially important to keep expenses low, monetary reserves high, and spending less than earning.    This seems like a no-brainer to most business owners.  However, home-based business owners are often a bit fuzzy about the separation of business and home expenditures.

For example, much of my work is undertaken on my computer.  I also use my printer for printing handouts for clients.  Consequently, it is tempting to rationalize purchasing newer, faster, sleeker computers and printers since it could be for home use as well.  Yet, instead of jumping on that fast-spending bandwagon, I scrutinize all expenditures asking myself if the intended purchase is want or need. 

Separate work from home.

My biggest problem is knowing when to close the blinds and call it a day.  I enjoy my work and typically find reasons to extend each working day.  Not only is this unhealthy, but it could also lead to costly mistakes due to being overtired.   So, I set clear business hours.  This isn't to say that hours can't be tweaked now and then.  For example, my husband recently retired, so I may borrow a few work hours to accompany him on errands and finish my projects for clients afterward. 

Be receptive to change.

Customers’ moods and tastes change, especially in this fast-paced Internet-driven world.     Not every business can stay current or popular forever.  So, it’s best to keep one eye open looking for that changing wind.  For me, this means that I always consider my relevance.  Additionally, are all my products relevant?  If not, I punt.

Punting for me is switching gears, taking what I do, and making it more relevant for today’s consumer.  This can only be done by reading and noticing what the current trends are.   This doesn’t mean that I would or should change my entire business model—unless of course, my business can’t compete at all. 

Take it seriously!

When starting my small business, I didn’t consider that it would be a full-time affair.  It was a sideline, something to keep me busy while helping others.  However, when it started picking up steam and clients began paying me, I had to decide if this would be a hobby or a business.   I chose to dive right into business mode.  If you’ve decided to do the same, treat it as a business.  Work adequate hours to support your business and keep expenses low. 

More by Rebecca

First Person: How I'm Surviving His Retirement as a Home-Based Business Owner

Having Goals Makes Us More Productive

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