How to Start a Small Business Employing the Home Business Model

Small business is a phrase that is used every day by millions of people across the globe. This is because during the past decade the rise of small business has become more substantial than in any other decade prior. This is largely due to the growing number of services that are offered to small business owners, to make it possible for them to keep their business running. In this article we will talk a little about what a small business is and some of the steps you will need to take to start your own.There really isn’t any guidelines for when the term small business is used, however it is simply defined as a business which has a small number of employees. How few employees is debatable, and the definition of when a business changes from a small business to a bigger business differs both by country as well as industry. This number is generally less than 100 employees.As I’ve already explained small businesses due to their nature, are usually sole proprietorships, partnerships, or privately owned. Common in many countries, smaller businesses, tend to be related to: Professionals merchants and all small and medium scale entrepreneurs etc.Small businesses are often located in private homes, for two main reasons. The first is because it is cost-effective and in most cases convenient. The second reason is that there are several benefits with taxes, etc by having your business in your home.This has given rise to the home business model.Running a small business is an exciting opportunity, a great way to introduce yourself into the business world, and to gain business sense. But, before you spend a lot of money on your small home business it’s important that you know the facts, so take some time, go to the library or get on the internet and research the basics. If possible talk to a few experts or other small home business owners so that you can be sure that entrepreneurship is right for you.Here is a quick list of some things that you can do to get started;- Carry out an assessment of your home business idea. Describe what your typical customer, your product and your competitors. Who will your suppliers be? What will you charge for your product? How will you market your product? These are just a few of the questions you need to answer.- Obtain a comprehensive Home Business action plan. Do this using the information you gathered from your feasibility study. This is vitally important and often an overlooked step that needs to include a description of your company, its goals, competitors, market, financial information, and of course, how you intend to meet your goals.-Get your home business financing in place. There are many ways to finance your business, from your own savings to personal credit cards to bank loans. If you need credit, know your business plan from front to back and maybe even sideways.-Decide what kind of structure your company will have. From a legal standpoint, there are three basic choices, sole proprietorship, partnership and incorporation, each with advantages and disadvantages. Majority of home businesses tend to be sole proprietorships.- Choose a name for your company and check on name availability. Naming your company is highly individual, but it’s the first thing associated with your business, so choose your name carefully. You’ll need to do a NUANS (Newly Upgraded Automated Name Search) report, which checks your name choices for uniqueness against a database of other business names. A reserved name is valid for 90 days.- Determine whether there are special permits or licenses that your business will need. Check with county court house or your local tax collectors office for the proper forms.- Set up your home business bank account and record-keeping system. Your banker will need to see your business documents, and you may want to set up more than one account so you can keep track of your finances better. Record-keeping is required, and can be done manually or with a computer program.- Purchase insurance. There are many different types of insurance, but most probably your company will need at least one. For example, if you’re going to have employees, you need to have workers compensation insurance.- Decide where your business will be located. Set place aside in your home for your small business. You can set aside a spare room or your visitors room. There are advantages and disadvantages to starting your business from home. You have tax write-offs for example, but sometimes your image suffers.- Purchase supplies and office equipment. You’ll need too many things to list here, and of course, each business has different needs. You will also require office equipment for communication and data processing. You’ll probably need a computer. Office stationery and equipment will be a prerequisite.Being armed with the facts and information you need from the beginning is a giant step towards ensuring the success of your small home business. So take your time and do your research based on the above steps and processes and your success will be guaranteed.

Should You Open A Franchise Or Start A Home Based Business? Why Home Business Is A Better Option

Before I got into the home-based business industry I weighed in heavily on the option of opening a franchise. I signed up for newsletters and got daily updates for franchise opportunities that were available. What I found was much like the home business industry, there are many, many opportunities to choose from. I knew it would be tough to decipher the good ones from the bad and spent a lot of time doing so. In the end, I came to the conclusion that none of them would be a good option for me and chose home business instead.Now don’t get me wrong, I’m not knocking on franchises. There are plenty of success stories out there for that type of business, and for many it’s a great option. They just weren’t conducive to my goals and the lifestyle I wanted to live. I’m simply going to show the similarities and differences between home-based business and franchising to give a better understanding why home-based business can be a better option.The similarities between the two are abundant. They both offer an array of different opportunities to meet your budget guidelines. I’ve seen franchise options out there that require start up capital as low as $10,000. Some even offer in-house financing. With a home business you can start with an investment as low as $1000-$2000.They both offer a proven business model to help ensure your success. This includes things like training that are based off of what has worked, and hasn’t worked for others out there. With a franchise you can get in contact with other franchisees for advice on how to run your business more efficiently much like you can contact successful leaders in the home-based business industry.The biggest similarity of all is that they’re both going to require a lot of dedication and hard work. You can’t buy into a franchise and expected to make money the next day. The time and effort you put into it will ultimately dictate your success. There’s no such thing as a free lunch in this world and get rich quick just doesn’t exist. You have to be passionate about what you’re doing and do it every day to reach your goals. Both of these businesses have a failure rate that can be caused by a number of things. It could be because of a bad business model, or someone just didn’t work hard enough for it to be successful.Though some of the similarities we mentioned may sound great, it’s the differences that can make you second guess whether or not franchising is the path you want to take. With franchises you have a lot of overhead and operating costs. You’re going to have to pay rent for the space you lease, on top of additional things like electric, water, and sewer.In most cases you’re going to need to have employees and the payroll that goes along with them. You’ll have to go through the trouble of finding people you can trust. You want to make sure they aren’t people who will steal from you. If you don’t want to be there all the time you’re going need to hire a store manager on top of that.There’ll also be things like equipment or inventory that will be required to operate successfully. Not to mention the franchise and royalty fees that have to be paid in order for you to stay a franchise and use the franchise name. Normally this is a hefty flat fee and a percentage of sales. Add that to the money you spent to buy into the franchise and you can see how quickly your costs can rise. For a more popular franchise you’re going to pay hundreds of thousands of dollars and be required to have a set amount of cash and assets to even be considered.It could be years before you ever even turn a profit and you’re going to have to work 60 to 80 hours a week. Even when you do turn a profit it could be a very small margin. All of those long hours you put in could be for very little pay.With a home-based business you eliminate all those variables. You have a low start up cost and can work at a pace that best suits your current situation. Like me, most people got started while they still had jobs. There are no additional overhead costs other than what you already have at home and there’s no need to hire any employees. You won’t have to worry about traveling to a brick-and-mortar store every day or what you’ll do if you find the time to go on vacation. With a home-based business you can work wherever you have Internet access.You won’t have to pay any franchise fees and you can turn a profit much quicker. Your profits will be higher and you won’t have to work those 60 to 80 hours a week. The differences are tremendous and the risk is much, much lower.With that said, it’s important to do your research. As we’ve outlined here it’s easy to see why starting a home-based business can be a much better option. I’m not saying franchising is a bad thing. If you’re thinking about opening a store make sure you’re ready for the challenge that lies ahead. The same goes for home business to. Remember to weigh the pros and cons and get educated. Making an informed decision and working hard will add to your success.