With the advent of affordable technologies and a surge in entrepreneurial spirit and e-commerce, more and more small businesspeople are launching businesses from their homes. According to Inc. magazine, in 1997 more businesses were started from home than commercial sites (705,000 compared with 610,000). Money is a primary reason for the decision, as many home-based entrepreneurs start with less than $5,000 and no savings (according to Peterson's Ultimate Home Office Survival Guide). I was one of the 705,000 home-based businesses started in 1997. After less than a year, I moved (fled, almost) to an office building. In my experience, a home office is a good starting point, but not viable in the long term. However, there are thousands of small-business owners who wouldn't have it any other way. Here are some things to consider when thinking about working from home:
How much foot traffic will you have? Clients, salespeople, and mail carriers may all need to visit. Is your home zoned for business applications? Will your insurance company cover any accidents? Is your home set up to accommodate visitors? In my case, my home was not a good place to meet with clients (too many critters), but it was fairly easy to meet at a client's place of business, a restaurant, or coffee shop. For bigger meetings, check with your Chamber of Commerce -- you may be able to use the conference room for free.
How much space do you have? Will it allow for expansion as you add clients and equipment? I started with what I thought was ample space, but after adding a second printer, scanner, fax machine, and more file drawers, it was a bit of a gauntlet. To make it trickier, every time I added a piece of equipment, it displaced one of my husband's possessions. One time he even lost his entire dresser to my impromptu expansion.
How will your family adjust to the office? Will you be able to have a dedicated space, with no intrusions? Will you be able to keep your business phone off limits to others? Will your equipment be used only for business, or will you have to vie for time on the computer? Will there be resentment if you're home and not spending time with your family?
Can you keep your business and personal life separate? Can you work if the dog is barking, the kids are screaming, or the laundry needs to be done? Will you be able to stop and start working at certain times? For me, this is where my home-based business took over my life. There were too many little things to do at home and too many distractions. I also found myself never getting away from work. Although I still maintain a home office for weekend work, I feel liberated by having the bulk of the work outside my residential four walls.
Think about the environment in which you'll be working. For me, the basement was the only space large enough for all my gadgets and files. My husband set up fluorescent lights all over the place, so there was ample lighting. Still, working below ground got to me after a while, especially those short winter days when sun was scarce. Try to pick a space with good natural light and a door you can close to the outside world.
There are also some marketing concerns to being based at home. Although there are millions of home-based businesses now, I believe there is still a stigma associated with working from home (sadly the bon-bon-eating, Oprah-watching stereotype is a myth). If you decide to launch from home, keep in mind the following:
Don't use your home address for your business cards, stationery, collaterals, etc. Better to have a PO box where you can get all your mail. It looks better than 123 Evergreen Road, Apartment 201.
Without a storefront, your image is all you have. Spend time and money to make your business cards, brochures, and stationery reflect a truly professional operation. Not to sound like a broken record, but please don't make your business cards and stationery on your own (unless you're a graphic designer). Don't use those pre-perforated business cards you can buy at office stores. It's tempting, I know, but business cards are relatively inexpensive to have designed and professionally printed.
Don't skimp on a dedicated phone line. A phone line for business use only is absolutely necessary. Get yourself set up for voice mail, rather than an answering machine (it sounds more professional.) Don't skimp on Internet connections or fax lines, either.
Make sure that you can close out the noise of your household. The one time I didn't close my office door while on the phone, my German shepherd spotted a squirrel in the back yard. Pandemonium. Luckily I wasn't speaking with a client, and I learned my lesson.
Answer the phone professionally. Sounds like a no-brainer, but I am surprised by how many business owners answer their phones with just "hello." If you have little kids, don't let them answer the phone. It won't seem cute to your clients.
Get out of the house every day, even if it is just to get the mail or take a brisk walk. Creativity suffers the longer you spend in one place. Being at your computer screen in your den all day can suck the mental sharpness right out of you.
Stay involved in outside meetings and activities. Plan lunch dates, go to seminars, check in with customers and prospects. Don't stay trapped in your office.
Starting a business from home is a great way to ease into your new business. If you start on a shoestring, as I did, it's wonderful not to worry about coming up with a rent check every month. If you are not well suited to home-based business, you will know very quickly; as you grow and become successful, you can always move to a larger space outside your home.