Home-based businesses have always been popular. That said, it seems that the Covid-19 outbreak has had a big hand in garnering more appeal for the idea of starting a home-based business. With more people self-quarantining in their houses, idle minds and hands have been finding it hard to stay unoccupied. Not only that, but the quarantine has also led affected business owners to find new ways to run their business from home. So while the concept of starting a business from home has always been out there, now more than ever, there is no doubt that it is possible. The real question is, how hard is it? Here is what you should consider.
The Suitability of Your Business Idea
Many people often make the mistake of thinking that any business can be run from home, regardless of its type. Unfortunately, this lack of preparation leads to unfinished ideas and half-pursued dreams. Depending on your idea, you’ll be able to determine how possible it is to start the business. If you’re planning on creating an Instagram account where you can feature and sell your art and designs, all you need is a computer and a small space to create.
On the other hand, if you’re planning on opening a doggy daycare, you’re going to need ample space for the dogs, toys, food, and other related supplies, as well as specific permits, licenses, and don’t forget the taxes. The point is, some businesses come with many financial, legal, and mental burdens that make them difficult to manage from home.
The best way to figure out a practical business idea is to sift through your talents and skills and try to find the simplest, most efficient way to communicate it to the world. Try to keep your business mostly reliant on the internet and on as little space as possible.
The Existing Market
Another factor that will define your journey towards a successful home-based business is the market you will be establishing yourself in. Some markets are more competitive than others, that’s a fact. Photography, for example, is not a niche market.
If you decide to sell your photos, you need to take into account that you’ll have to put in effort so you can separate yourself from the competition. If you decide to sell rare antiquities, however, you’ll be breaking into a market with only a few competitors which will translate into a higher success rate. Think of competitors as pebbles in a still pond. In a niche market, any pebble will make a splash because the pond is relatively still.
Keep in mind that this is not to deter you from the saturated markets, this only means that you will have to make more of an effort to run your own stable business. Of course, you can always opt for managing a franchise if you have the entrepreneurial spirit necessary. Just like fast-food chains and department stores, home-based franchising models have been on the rise lately, and by offering franchise opportunities at home, they are showing no sign of slowing down. If you have a mind for business, managing a franchise will not only be a challenge, but it will also make it easier to escape the struggle of competing with the big fish because you’ll already be the big fish.
Once you’ve settled on a business idea that feels right, the best next step is to do a little market research. Find out what the people need and want, who is supplying those needs and wants, and for how much.
Just because you’re working from home, it doesn’t mean that you won’t be spending anything. A home-based business doesn’t come with obvious expenses like premises, utilities, regular upkeep, and such. If you’re not prepared, most of the expenses you’ll be paying are going to sneak up on you.
To run a business from home, you need a website. With a little time and effort, you can build an attractive user-friendly website, even if you’re far from tech-savvy. It will cost you nothing. The costs lie in publishing your website because to do that, you need a domain name and a web hosting company, which you’ll need to pay for yearly or monthly. If you add that to the amount you’ll be spending on marketing your products and your brand, buying supplies, and shipping – if you’re planning to offer free shipping as a marketing strategy, you’ll end up with a long list of expenses.
With the prices you’re planning on selling with, are you going to be making enough money to keep the business afloat? If not, you’ll have to get creative. If you’re new in the market, you can’t come in with the highest prices, but you can capitalize on your low prices. One strategy is undercutting the market at first to attract customers. Once you’ve built a name and a reputation, a gradual increase in prices will get your profits back on track.
What you need to consider is how much money you can afford to spend, how much money it will take to run the business, and a simple profit and loss forecast. Budget-wise, a home-based business is a lot less expensive than an on-site business which already gives you an advantage. If you combine that advantage with diligent preparation and a seamless budget plan, you’re guaranteed to make a dent in the market.
To answer your question one more time, starting a new business from home is a couple of clicks away if you know what you’re doing. While the road to your own successful business is not a flower-laden path, it also isn’t for those who aren’t willing to go all in. Regardless of where you run your business, if you’re not willing to commit to doing the work that puts you on top, you simply won’t get there. Prepare yourself well, do your market research, take it slow and steady, and you’ll find yourself reaping the rewards. Remind yourself that you’re building something from scratch and that you will reach a stage where the business will be running itself. You just need to keep going.
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- How to Raise Money to Finance a Franchise
- Pros and Cons of Starting a Franchise Business
- Buying Your First Franchise