Get Your Home Business Up and Running

Ultimate Guide to Planning and Building a Successful Home Business

Open a Home Business
Open your own home business. Credit: Jamie Grill | Getty Images

Starting a home business is an ideal way to take control of your career and income, but it can’t be started on a whim. Before you can open for business, you need to decide if you're up to the challenge, determine the right option for you, research your idea, and plan every detail of your success. Each step of the process has many tasks that can make home business startup overwhelming and sometimes confusing, without an organized plan.

Discover if you’re cut out for the home based business lifestyle, as well as get home business ideas, learn about start-up tasks and self-employment taxes, plus get the tools and resources necessary to make your home business dream a reality.

Things to Consider Before Starting Your Home Business

Whether you want to stay home with children, have more free time for personal pursuits, or like the idea of being your own boss, a home business is ideal for achieving all that and more. However, it's not without its drawbacks and challenges. Further, there are many myths and misconceptions about home business that can hinder your success. Before getting your business license, you need to consider:

  • Are you suited to working at home? Can you work independently? Are you organized? Can you be accountable to yourself and your clients and customers?
  • Are you goals realistic? Overnight success is very rare. Building a profitable business takes time and consistent effort.
  • Are your finances in order? Do you have a nest egg to live on until your business is successful or do you plan to work your business around your job? Do you know how much you need to start and what you need to earn?
  • Have you learned about home business through books, blogs, and talking with entrepreneurs so you can anticipate what it’s really like.

    Here are other resources to check to make sure you know what you’re getting yourself into and can prepare accordingly.

    Getting Ideas for Your Business

    The options for starting a home business are extensive making it easy to get overwhelmed with all possibilities. Further, it’s easy to get distracted by promises of fast money. But home business should be viewed as a marathon, not a sprint. Slow and steady will win the race. But to win, you need to pick an idea that you can commit to.

    Having a list of ideas, as provided below, will help get your creative juices going. However, don't forget that you probably have skills, experiences and interests that you can turn into a home business. Don't dismiss using what you already know, love or do, as a home business opportunity. Most people who have a successful home business have tapped into their passion or skills, so start by making a list of yours from all areas of life such as your jobs, volunteer activities, hobbies and interest.

    The home business options provided a below are intended to provide ideas and resources, but in no way suggest that you'll find guaranteed success.

    Choosing the right home business is just the first step in the path. Your success will depend on how well you execute your idea.

    Planning for Home Business Success

    Starting a home business is exciting, but you need to temper your enthusiasm by doing research and making smart choices.

    Excitement will fuel your energy, but only through action will you find success. This is often the boring part of the process but is crucial to ensuring your success. Something you need to plan and anticipate include:

    • Is there a ready, willing, and able market to buy your products or services?
    • Should you buy an existing business or start from scratch? What do you need to know for each?
    • What is your state, county and city legal requirements for starting a business, and will you need any additional permits?
    • Have you written a business plan?
    • What will need for insurance coverage, health, and business-wise?

    Here are a few articles to check out to help you research your business idea and begin to prepare your home business launch:

    Creating Your Business Identity

    Once you've decided to take the plunge and start your home-based business, it will need an identity of its own. Creating an identity for your home business is not particularly difficult, but it pays to go about it in an orderly fashion so you won't have to back and re-do a lot of the steps. Some of the tasks involved in creating your business identity are fun, such as deciding on a business name or creating a logo. Others might seem tedious or worrisome, such as deciding your business structure.

    Here are a few resources to help you create a business identity so you can open your doors with a minimum of headaches and inconvenience.

    Starting an Online Home Business

    Before the Internet, there were fewer options and it was more expensive to operate a home business online. For many, the only home businesses they could run involved sales or other face-to-face or phone work they didn't want to do. The Internet has changed all that. While the Internet has created income opportunities and made it faster and easier to start and build a home business, the income isn't automatic or guaranteed. Yes, you can be "open" online 24/7, but that doesn't mean people will shop with you. Success in any business, online or off, is in the quality of your product or service, and how well you market it. With that said, the Internet provides a host of fun and potentially profitable home business options that you can learn about from the list below.

    Setting Up Your Home Office

    Setting up your home office is fun and exciting. Having a comfortable place to work that is away from distractions will help with focus and productivity. The IRS requires that you have a separate office space if you plan to take the home office deduction. A few things to consider when setting up your home office are:

    • Is there enough light?
    • Is your chair comfortable?
    • Is your computer set up at an appropriate height?
    • Do you have all your supplies and equipment with easy access to do your work?
    • Is your office free from distractions?

    Here are tips for setting up an office that helps be focused and productive, as well as maximize your tax options.

    Managing Your Money and Taxes

    Anyone who plans to start a home business needs to be well aware of the financial aspects of running a business. Failure to adequately fund and manage the financial aspects is one of the top reasons businesses fail. Additionally, some budding entrepreneurs will want to try to get startup capital for their home business. Money issues to consider include:

    • Do you have enough money to operate the business?
    • Have you run the financial numbers and know what you need to sell to make a profit?
    • Have you priced your products and services competitively and yet profitably?
    • Have you set up a money management system to track income, expenses, invoices, etc.?
    • Have you learned about self-employment tax and business deductions?

    These topics help you understand financial and tax issues you should consider when starting a home business.

    Marketing: The Key to Home Business Success

    Having a great product or service is crucial to home business success, but so is marketing. If people don't know about your product or service, they can't buy from you. If they can't buy, you don't have a business.

    Marketing starts by knowing your product and service and how it helps others. What benefits will people get from using your products and services? Next, you need to decide who can best benefit from what you offer. This is your target market, and it’s crucial that you understand who these people are. What is their gender, age, socioeconomic status and location? Where can they be found online and off? What needs do they have that would prompt them to need your products and services? If you’ve answered the previous questions, you should have a good idea of how and where to market your business. If your business helps moms save time, creating marketing content that talks about saving time and placing it where moms can be found will be the fastest, cheapest and most effective way to get the word out about your business.

    Here are resources to setting up an effective marketing plan.

    Getting Things Done

    Taking care of all the tasks to get a business up and running, and then continuing to manage it can be a challenge. This is especially true if you're starting your business on the side around a job or family. Running a business along with everything else can feel a little like plate spinning as you run from one task to the other.

    As quickly as possible, you need to set up the routine and organizational systems that work best for you. This can require trial and error methods of finding your peak work schedule. Some things to consider include:

    • When are you at your peak energy? Are you a morning person or night owl?
    • Do you need to handwrite your to-dos and appointments in a schedule or do you need a portable digital system?
    • What other tasks and activities do you need to get done around your business? For example, are you homeschooling your children?

    Check out these articles for more tips and ideas on setting up a schedule that works for you.

    Overcoming Obstacles in Home Business

    Working at home isn't as easy as you might expect. It's important to anticipate and plan for potential problems and challenges. For example, is your family on board with your home business plan? Are you prepared for it to take awhile before you see a profit? What happens if your computer dies and you lose your work?