Homework has taken on new meaning recently. The drive for economic
self-sufficiency has motivated large numbers of persons to market their skills
and talents for profit from home. Our increasingly service oriented economy
offers a widening spectrum of opportunities for customized and personalized
small business growth. Though untrained entrepreneurs have traditionally had a high rate of failure, small businesses can be profitable. Success in small home based business is not an accident. It requires both skills in a service or product area and acquisition of management and attitudinal competencies.

The purpose of this guide is to help you take stock of your interests, aptitudes
and skills. Many people have good business ideas but not everyone has what it takes to succeed. If you are convinced that a profitable home business is
attainable, this guide will provide step by step guidance in development of the
basic written business plan.

Gathering Information

While the reasons for the rapid growth of home based business operations mayvary from the need to supplement family income with few hundred dollars all the way to a sophisticated technical consulting service billing hundreds of
thousands of dollars, there are many common characteristics and challenges
to be considered in launching most home based businesses, regardless of
size. Some tasks are universal to all small business startups, while others are
unique to a home base.

Careful planning, based on interviews with dozens of home based operators
over the past decade indicate that special planning is required to research legaland tax issues, proper space utilization and to establish time management discipline. Inadequate or careless attention to development of a detailed business plan can be costly for you and your family in terms of lost time, wasted talent and disappearing dollars.

Selecting a Business

Perhaps you have already decided what your home based business will be.
You know how you will serve your market and with what. If not, but you are
determined to establish a home based source of income, then you need to
decide exactly what business you will enter. A logical first step for the
undecided is to list potential areas of personal background, special training,
educational and job experience, and special interests that could be developed
into a business. 

Time Management

For both the novice and the experienced business person planning a small
home based enterprise, an early concern requiring self-evaluation is Time
Management. It is very difficult for some people to make and keep work schedules even in the disciplined setting of an employer's office. At home, as your own boss, the problem can be much greater To determine how much time you can devote to your business, begin by drafting a weekly task timetable listing all current and potential responsibilities and the blocks of time required for each. 

When and how can business responsibilities be added without undue physical or mental stress on you and your family? Potential conflicts must be faced and resolved at the outset and as they occur Otherwise, your business can become a nightmare. During the first year of operation, continue to chart, post and check off tasks on a daily weekly, monthly basis. Distractions and excuses for procrastination abound. It is important to keep both a planning and an operating log. These tools will help avoid oversights and provide vital information when memory fails. To improve the quality of home work time, consider installation of a separate telephone line for the business and attach an answering machine to take messages when you do not wish to be distracted or are away from home. A business line has the added advantage of allowing you to have a business listing in the phone book and, if you wish to buy it, an ad in the classified directory.

Is My Home Based Business Workable? 

• Where in the home will the business be located?

• What adjustments to living arrangements will be required? 

• What will be the cost of changes? 

• How will your family react?

• What will the neighbors think? 
  

It will be important to set aside a specific work area. For example, more than one fledgling business ledger has gone up in smoke, been chewed by the family dog, or thrown out with the trash when business records were not kept separate from family papers. Ready access to business records during work hours is essential, but they must be protected. 

Note that changes in personal habits will be required. Examples: 

Self discipline to keep your television off while working. 
Limiting personal telephone calls in length and number 
Diligence in meeting work deadlines when no one is checking 

Ask family members to comment on pros and cons. Their concerns may require reconsideration of some specifics.

Is My Home Based Business Allowed In My Area?

You will want to investigate potential legal and community problems associated with operating the business from home. You should gather read and digest specialized information concerning laws and regulations concerning home based business operations.

Check first! Get the facts in writing. Keep a topical file for future reference. Some facts and forms will be needed for your business plan. There may be limitations enforced that can make your planned business impossible or require expensive modifications to your property.

Items to be investigated, recorded and studied are: 

• County or city zoning code restrictions.

• Necessary permits and licenses for operation.

• Laws and codes regarding zoning .

• Deed or lease restrictions such as covenants and restrictive conditions
  of purchase.

• Parking and customer access, deliveries, sanitation, traffic and noise codes.

• Signs and advertising.

• Code requirements for space, ventilation, heat and light. 

• Limitations on the number and types of workers If not, check with the
  local Chamber of Commerce office.

• Reservations that neighbors may have about a business next to or near
  them.

Is the Home Based Business Insurable?

In addition to community investigations, contact your insurance company or
agent. It is almost certain that significant changes will be required in your
coverage and limits when you start a home based business. When you have
written a good description of your business, call your agent for help in insuring
you properly against new hazards resulting from your business operations such as: 

• fire, theft and casualty damage to inventories and equipment.

• business interruption coverage.

• fidelity bonds for employees.

• liability for customers, vendors and others visiting the business.

• workmen's compensation.

• group health and life insurance.

• product liability coverage if you make and/or sell a product. workmanship liability for services.

• business use of vehicle coverage.

What are your advertising plans? Each product or service will need its own advertising strategy as part of the total business marketing plan. Before
developing an advertising campaign for your business plan, take time to review
a few basic assumptions. By definition, advertising is any form of paid,
non-personal promotion that communicates with a large number of potential
customers at the same time. The purpose of advertising is to inform, persuade
and remind customers about your company's products or services. Every
advertising activity should have specific goals. Common examples are: 

To bring in sales orders or contracts. To promote special events such as sales, business openings, new products. To bring in requests for estimates or for a sales representative to call. A special goal at the outset may be to use special media to establish yourself even before startup and to get potential customer "feedback".

These might include one or more of the following: