The Potential Downside to Starting a Home Based Business
by Angela Wu © Copyright
Home businesses are an increasingly popular option for
people seeking a way to earn an income in a way that
better fits their lifestyle. The benefits of starting
a home business are often highly praised -- some of
these benefits include:
* The flexibility to schedule your day in whatever way
is appropriate for both you and your business.
* The independence to make the decisions you think are
best for your business.
* The comfort of dressing how you want and working how
you want, provided you aren't meeting with clients.
* The tax breaks potentially available to home
businesses.
* The opportunity to build the income you want, rather
than being paid what an employer thinks you're worth.
Starting a business from home, however, does have its
drawbacks. It can be a wonderful opportunity but it's
certainly not for everyone! Consider the following:
* Time. Although you have the flexibility to schedule
your day to a certain degree, the amount of time
required to start and build a home business is
significant. A comment that sums it up nicely is,
"I get to choose any 20 hours a day that I want to
work!"
* All business involves risk. You may be a wild success
... or you may work endless hours, invest a lot of
money, and end up with a failed business. There is
also the risk that you may grow too quickly and be
unable to properly manage your growth. This can lead
to unhappy customers and the eventual demise of your
business.
* Financing may be difficult. Due to the risk associated
with a home business, some lending institutions may
refuse your loan application or may provide with you
inadequate funds or a higher interest rate. You may
have to consider using funds from your "day job" to
help finance your startup business, personal savings,
or perhaps loans from friends or family (which may
create problems of its own).
* No benefits. Because you will be self-employed, you
are responsible for funding and managing health and
dental benefits.
* You have to do everything yourself. Most people start
as the sole "employee" of their fledgling business.
As such, you're not just the product designer &
developer, but also the marketer, administrative
assistant, cleaning staff, customer service rep, and
possibly other roles as well.
* Getting customers. When working from home, you don't
really have a "storefront" -- and zoning regulations
may prevent you from displaying a sign in your yard.
Even if you could, the flow of traffic through a
residential area is not likely to be very high and
thus it may be harder to attract new customers. It's
your responsibility as a business owner to find out
where your prospects gather, how they like to be
contacted (direct mail, niche magazines, etc), and
whether you're up to the task.
* Assumptions about your "free time". Unfortunately,
many people believe that "working from home" doesn't
really amount to "work" -- and sometimes friends and
family may "drop in" or call for a chat while you're
working. Some people find it very difficult to turn
away "guests", even though they're clearly trying to
work.
* Isolation. Working in an office environment provides
you with plenty of opportunity to socialize. In the
home, however, you are far more likely to be limited
to the phone and to email -- and some home businesses
have even little need for that. It can make one feel
"cut off" from the rest of the world and lead to
loneliness.
* Lack of support. One common observation from home
business owners is their spouse or other family
members get impatient with their efforts -- there may
be a misconception that you're doing nothing but sitting
around the house, particularly when the business is in
the startup phase and hasn't yet started to produce
profits.
* Difficulty separating business and personal matters.
Since you're at home, you may be expected to do
household chores, watch the children, drive relatives
around, etc. Family and friends may not entirely
understand that you are operating a business and
need the time to attend to business matters.
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Angela is the author of "So You Want to Work from Home!",
an informative report packed with useful tips and resources
on how to begin a work-at-home career. Pick up your copy
today at http://homebasedwork.com/report.html
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