If you’re tired of your nine-to-five job and you’ve been thinking about putting up your own business, this article could be of help to you.
Putting up your own business is no easy feat. It requires money and resources to be able to do so. However, don’t be discouraged if your savings is not enough to build an empire yet. You can start by having a home-based business. It creates more flexibility in how you spend your time and your money. This is not a quick process or a guarantee of financial success immediately but it’s a good start. It requires a long-term commitment and a clear understanding of the work involved.
Below are the tips you can to consider before you start your own home-based business:
1. Identify your small business idea.
In the previous article, we’ve listed down some small business ideas you can choose from. It’s a vast selection but if you think those are not for you, you are free to come up with your own business idea. Just make sure that you have the right experience, training, and skills necessary to be successful in your choice of business. It is important that you have enough knowledge of the business you want to enter in before actually taking the plunge. Spend time conducting research to learn whether this is really the right fit for your experience and interests.
2. Start as a side business or a hobby.
It is advisable that before you completely resign from work and focus on your business, you have already tried running the business first on a sideline basis. Perhaps you can do it during weekends when you don’t go to the office. This allows you to make some mistakes, test the market, and understand whether your ideas have legs before you say goodbye to your day job and lose your primary income.
3. Decide on your software.
One of the essential things you need to do is to decide on the software you will use to help you be more efficient in your business. Every business is different, but almost all companies can use software to help with analytics, project management, accounting, bookkeeping, email marketing, and other basic day-to-day tasks. You can utilize a free CRM or customer relationship management tool to keep track of important customer information in one central database. It will help align your team and make sure that you stay organized as your business grows.
4. Create a business plan.
Once you have decided on what business you will undertake, you can now start building your business plan. There are available business plan template online that you can use. Your business plan must include the following elements:
- Executive summary – A high level overview of your company and market placement.
- Business model – It is the outline of what your business does, who your business serves, and how your business is structured. You should include a description of what products and services you offer and how they meet the needs of the customers.
- Market condition – It is a summary of pertinent competitor information. It determines the strengths and weaknesses of your closest competitors.
- Products and services – Use this section to describe your products and services in detail, and outline what differentiates your product from others in the market.
- Operations and management – Outline your business’ organization structure, key roles, and responsibilities.
- Marketing and sales strategy – This section describes how you will market and sell your product. It includes information on your ideal customer, how you plan to position your offering, and your sales strategy.
- Financial plan – It is a detailed outline of your business financials. It includes your start-up costs, your financial productions, and how you anticipate generating funding.
- Appendix – Once the above pieces are complete, end the document with an appendix summarizing your business plan.
Take note that your business plans should identify what makes your offering different from competitors. They should also be short and feasible. Most importantly, your business plan should evolve with your business.
5. Decide whether it’ll be a corporation or sole proprietorship.
There are two common legal structures for small business – the limited liability corporations (LLCs) and the sole proprietorships.
The LLC is more complex than the sole proprietorship and it includes individuals, corporations and other LLC members. Moreover, it is not subject to a separate level of tax and offer the business owner liability protection and tax advantages. LLCs are formed on a state-by-state basis.
The sole proprietorship, on the other hand, is a business owned by one person and is not identified as a separate entity from the owner by the government. While it is the simplest business structure, sole proprietors are personally liable for their business.
6. Create a business bank account.
It is advisable that you open a separate bank account for your business. It is essential for keeping your personal and business finances separate which can help you gain an accurate picture of your business’ cash flow and financial health. It also helps in bookkeeping and tax preparation.
7. Determine if your business idea works well from home.
It is important that the business you choose works well in a home-office set-up. Some businesses are not suited to being based from home.
8. Set up an office.
Even if your business is just home-based, make sure that you set-up a designated work space for that at home. You can consider setting aside a corner in your living room or putting a desk in your bedroom for a space that inspires you and creates the condition for success. This also looks professional for your future clients.
9. Get to work.
It is not easy putting up your own business, but most entrepreneurs will agree that it’s worth it. The payoff of being your own boss, making your own hours, and working on projects you are passionate about will pay dividends for the rest of your life. Don’t be afraid to ask for help throughout this process — and remember to have a little fun while you’re putting in the work.