Home Business Tip of the Week

   

Pros and Cons of Making Your New Business a Work At Home Business

Many very successful businesses started out as home businesses.

Michael Dell, for example, launched his computer empire from a
dorm room, and Hewlett-Packard famously got started out of a
garage.

But many other business people choose to acquire office space before launching, and find that the extra steps associated with finding a separate office are worth it for them.

What´s right for you? There´s no one answer, but wholly aside from the issues connected to any business start up, there are special issues associated with starting a business in your home. Consider these issues before you make the leap.

Benefits of a Work At Home Business:

  • A home business can cost very little to set up. You don´t need to incur out of pocket outlays for rent, furniture or duplicative office equipment.
  • It can cost very little to operate. Odds are, you plan to heat
    your home and keep phone service whether or not you start a home business.
  • Your commute can be very short - perhaps cross-bedroom
    instead of cross-town.
  • Even when you are very busy, you will be near your family
    more, allowing you to share in their lives more than if you were off at an office.
  • Depending on the business you are in, you might be able to
    work anywhere in the world.
  • You can set your own schedule, getting work done when it
    suits you instead of when the office doors are open.
  • In some circumstances, it may be both possible and desirable to take extra tax deductions based on using part of your home for an office.
  • If it really, really matters to you, you can work in your underwear.

Negatives of a Work At Home Business

  • Your home is set up for living, not working, and distractions
    abound - family, television, and household duties, just for starters.
  • Do you really want employees showing up to work at your
    home? Do potential employees really want to come to your house to work?
  • Suppliers and customers may be reluctant to come to your
    home to do business. (Hint: don´t tell them how cool you thought the hidden basement dungeon was in Silence of the Lambs.)
  • You will have to take extra measures to make your home based business appear professional, and not like a hobby or wannabe effort.
  • The ease of set up can cause you to skip important pre-launch steps - such as thinking through the proper legal form, acquiring insurance or creating a basic business plan - that can come back to haunt you later.
  • Both living and working in the same space can create a sense of claustrophobia if you don´t find ways to get out into the community.
  • Your family may resent your business more when it is home based, because it is always around and competing for your time.
  • Depending on the business and how visible it is, you can run into zoning and/or neighbor relations issues.

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Copyright Hard Knocks MBA, Inc. 2003