Starting a new home business can be an exciting time in your life but it also pays to be cautious. When you’re starting out it’s easy to make mistakes that can bankrupt you before you get out of the starting blocks. Fortunately many of these mistakes are easy to avoid with some simple forethought and we will discuss the most prominent of these in this article.
Limited Business Skills.
You may be an excellent architect, hairdresser, or artist but you may have no idea about bookkeeping, record storage, telemarketing, or running a mailing list. There are professional that can help you out with this matters but as a new business owner you will need to do as much as you can for yourself in order to save your money. Join a local small business group or service organization and network with other small business owners. Call your local Junior College, University or Small Business Assn and take a small business class to help you brush up on your business skills. It is imperative you learn about payroll and sales taxes if you don’t want to find yourself in a mess. Overlook the accounting aspect of your business and you will find Uncle Sam knocking at your door quickly.
Not Acting Professionally.
Many home businesses operate where clients may need to come to your home, you must make sure that it is a professional place to visit. Instill confidence. You will need to make a good impression when you are inviting people to your home office. You are operating a professional business and your clients won’t be confident in you if you have a messy office, the dog is barking or the kids are screaming when you are meeting with them. If you don’t have a separate space for your home office such as a converted garage or detached office space, consider hiring help to professionally clean your home, and look after your children and pets while you are meeting your new clients.
Not Managing Your Time.
You are used to being in an office from 8 to 5 Monday to Friday so an easy trap to fall into is not managing your time effectively when you work for yourself. Working in your pajamas during the day may sound exciting, but remember, you no longer have a boss asking you if your report will be on time or if you’ve met your sales quota. This is now your responsibility and if you aren’t careful it can be a difficult situation to adapt to.
Prioritize, draw up a schedule and stick to it. Remember even though you are in your home, you are running a business and you need to make sure you can accomplish your business. Keep your work space separate from your home and treat it as an office. If you are easily distracted, don’t take personal phone calls during work time, and don’t do household chores during your working time or you’ll find the entire day wasted. Tell your family that when you are in your office you are at work and should not be disturbed. Above all, avoid the tendency of your family to delegate household tasks such as grocery shopping, going to the bank, etc. just because you are “home all day”.
Spending Too Much, Too Quickly.
Starting a home business can be an expensive process. You need the basics; a computer, business phone system, copy machine, fax machine, and office furniture. These costs can add up quickly so ask yourself do you need all brand new, state of the art equipment, or can you get by with your existing household equipment. Consider leasing your furniture and equipment. While that will cost more in the long run, the lower monthly payments up front will get you valuable cash flow. Order your office supplies online. Companies such as Staples and Office Depot offer great prices and free next day delivery on most orders. Remember when you’re starting out you have limited budget and almost no income so why spend so much up front. Spending hundreds or thousands of dollars before you have any clients or cash flow is setting yourself up to fail.
Not Getting Permits or Insurance.
Don’t get shut down before you start. Most towns and municipalities will require a business license or permit in order to begin your home business. Don’t overlook this as a nosy neighbor, or business competitor can call in an anonymous tip and cause you a stop work order and even a healthy fine. A home business also has unique requirements such as customers coming to your home or perhaps inventory for your business stored there. Check with your home insurance company as you most likely will be required to purchase a business insurance policy to cover these situations. The last thing you need with your new home business is to have a customer slip and fall, or a fire in your storage area and find out you are not covered for your losses.
Starting your own home business can be richly rewarding, both spiritually and financially. Work hard, ask for help when you need it, and don’t cut corners and you will slowly but surely become successful.
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