Guest post: 5 Lessons to Be Learned About Starting a Home Business
With mergers, company closures, retrenchments, layoffs and a scarcity of jobs plaguing the planet nowadays, starting a home business has emerged as an attractive option for many people around the world.
Time was when a home business was limited to persons with special talents or skills, like cooking, sewing, making toys, handicrafts or the like. Today, with modern technological tools available to almost everyone, home businesses have expanded to include highly technical and professional jobs like accounting, graphic design, software development, medicine, law, and almost any business that doesn’t require a factory or an office.
Mighty oaks from little acorns
While many home businesses are offshoots of a hobby with very limited ambitions, that’s the way many of today’s mega-corporations started. To name a few…
- Apple, Inc. – started in the garage of Steve Jobs and Steve Wozniak
- Hewlett-Packard – another high-tech giant born in a one-car garage
- Rembrandt Group – the South African conglomerate that owns brands like Rothmans, Cartier, Dunhill and Montblanc
- Amazon.com – the world’s largest online retailer which started as an online bookstore
- Koorong – one of Australia’s largest retailers of Christian books and media
- Lindos Electronics – a leading British manufacturer of equipment to measure audio quality
Avoiding common home business mistakes
Many people who start a home business learn as they go along and are bound to make mistakes (sometimes a lot) before hitting on a winning formula. A good way around this is to learn from the mistakes of other home business startups. Here are 5 of the more common ones.
- Fuzzy business plan – Many a home business is the result of an “Aha!” moment. A person has an inspiration for a home business and starts to organize it without making a clear business plan. What exactly are you selling? Who is the target customer? How do you make the product known? Who’s going to distribute the product? How much time will it take? What are the prices? How much money to invest? These are just some of the questions that are often brushed over by the budding home businessperson.
- Frills over substance – It’s easy to get carried away by the trappings of a home business. Renovating a room to serve as an office; designing a logo, stationery and business card; choosing a computer and other equipment are just some of the frills that take up a lot of time at the expense of the more fundamental issues like objectives and targets, finding customers and fine-tuning the product.
- Unwise investments – There’s always some investment needed in starting a home business. However, spending a lot in startup facilities before establishing an income stream can cripple a home business. Whether it’s buying a new, larger oven (for a home-based cookie business) or a state-of-the-art computer (for an online venture), startup expenses should be minimized until the business starts to earn some money. Borrowing, renting or outsourcing are options that should be explored before incurring large starting costs.
- Wrong mindset – A home business neophyte has been either an employee for a long time or unemployed like a full-time housewife. For the erstwhile employee it takes some adjustment from having many business services provided by other departments to taking care of everything on your own. For a previously unemployed person, taking a home business “seriously” and applying the discipline of a traditional job can take some doing. The inability to acquire the right mindset can hinder the progress of a home business.
- Poor marketing – Many home businesses expect customers to start lining up from Day 1. The lack of aggressiveness in looking for customers, creating awareness of the product and marketing it through the most efficient means available is a major reason why many home businesses fail to take off.
There are, of course, other possible mistakes that you should be aware of but these five are the most common errors that startups fall prey to. Be wary of committing these and give your home business startup a better chance of survival.
About the Author:
Lewis Edward is one of the owners of TheOfficeProviders. He is a real estate investor with many interests in other sectors. Lewis researches and contributes various written features for TheOfficeProviders in areas regarding real estate, including office space for rent and servised offices and general business and economy matters. Lewis is experienced in the inner workings of both the traditional and flexible workspace industries and has developed close links with various figures in real estate circles, as well other circles.