Going to work used to mean traveling from home to a plant, store or office. Today many people do some or all of their work at home. Garages, basements and attics are being transformed into corporate headquarters of the newest entrepreneurs – the home-based business person.
Before diving headfirst into a home-based business, you must know why you are doing it. To succeed, your business must be based on something greater than your desire to be your own boss. You must plan and make adjustments along the road.
Ask yourself these questions and remember, there are no best or right reasons for starting a home-based business. But it is important to understand what the venture involves. Working under the same roof where your family lives may not prove to be as easy as it seems. It’s important to work in a professional environment. One suggestion is to set up a separate office in your home to create this professional environment. So, before rushing in to it, ask yourself:
· Can I switch from home responsibilities to business work?
· Do I have the self-discipline to maintain schedules?
· Can I deal with the isolation of working from home?
· Am I a self-starter?
· Does my home have space for a business?
· Can I identify and describe the business I want to establish?
· Can I identify my business product or service?
· Is there a demand for that product or service?
· Can I successfully run the business from home?
A home-based business is subject to many of the same laws and regulations affecting other businesses. Some general areas include:
· Zoning regulations. If your business operates in violation of them, you could be fined or shut down.
· Product restrictions. Certain products cannot be produced in the home. Most states outlaw home production of fireworks, drugs, poisons, explosives, sanitary or medical products, and toys. Some states also prohibit home-based businesses from making food, drink, or clothing.
Be sure to consult an attorney and your state’s department of labor to find out which laws and regulations will affect your business. Additionally, check on registration and accounting requirements needed to open your home-based business. You may need a work certificate or license from your state and your business name may need to be registered. For home-based businesses, a separate business telephone and bank account are normally required.
Also remember, if you have employees you are responsible for withholding income and social-security taxes, and for complying with minimum wage and employee health and safety laws.
If you are convinced that working from home is for you, it’s time to create your business plan. SCORE and its cadre of counselors are ready to help you. Call today for free counseling.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Wednesday, January 21, 2009
Tuesday, January 6, 2009
Wjy worry about competition?
Not too many years ago, if your products or services were unique and there was no competition within a 15 or 20 mile radius, you were able to maintain a very profitable business. As shopping center after shopping center opened, cyber retailing exploded, and franchising expanded, it became more difficult to maintain your exclusivity within a geographical area. However, if I trust in the merits of my product or services to be successful, why should I care about the competition?
Very few businesses operate in isolation without market competition. Direct and non-direct competitors are trying to convince customers to buy their products or services rather than yours. There may also be indirect factors impacting customer choice. It is in your best interest to attempt to learn more about the companies that are trying to reduce your take-home pay. Knowing the competition enables you to get a competitive advantage.
List the strengths and weaknesses of each of your competitors. Talk to friends, visit your competition, call for information about their products or services, and analyze how they advertise.
Next, take a sheet of paper and list each of the major competitors and give each a rating of 1-10, for product or service quality, process, advertising, and customer satisfaction. You can add other ratings that you feel are important.
You can now use the competitive analysis to make decisions relevant to your strategic marketing plan (an integral part of your business plan). Your marketing plan will guide you toward the right decisions in the areas of pricing and advertising. It will also help you to increase your company’s customer satisfaction rate (which usually shows up as a weakness in many firms). Finally, it can help you make the right decision in customer and product segmentation.
In summary, it is impossible to produce a realistic marketing and business plan without knowing your competition.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Very few businesses operate in isolation without market competition. Direct and non-direct competitors are trying to convince customers to buy their products or services rather than yours. There may also be indirect factors impacting customer choice. It is in your best interest to attempt to learn more about the companies that are trying to reduce your take-home pay. Knowing the competition enables you to get a competitive advantage.
List the strengths and weaknesses of each of your competitors. Talk to friends, visit your competition, call for information about their products or services, and analyze how they advertise.
Next, take a sheet of paper and list each of the major competitors and give each a rating of 1-10, for product or service quality, process, advertising, and customer satisfaction. You can add other ratings that you feel are important.
You can now use the competitive analysis to make decisions relevant to your strategic marketing plan (an integral part of your business plan). Your marketing plan will guide you toward the right decisions in the areas of pricing and advertising. It will also help you to increase your company’s customer satisfaction rate (which usually shows up as a weakness in many firms). Finally, it can help you make the right decision in customer and product segmentation.
In summary, it is impossible to produce a realistic marketing and business plan without knowing your competition.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, December 30, 2008
Am I ready to start my own business?
The thought of owning your own business and being the master of your own domain is exciting, challenging and somewhat scary. Many times people enter businesses without asking themselves key questions that could dissuade them from making the decision to go out on their own.
Ten Questions to Ask Yourself Before Going into Business
1. Is my product or service different from others already in my market area?
2. Do I have the right kind of business experience to support this business?
3. Can I prepare a detailed, credible business Plan for the first three years?
4. Am I able to take responsibility?
5. Am I a good organizer? For myself and others?
6. Am I ready to put in the long hours that probably are necessary for the first few years?
7. Am I ready to stick to it even in rough times?
8. Do I have the full support of my family?
9. Do I have adequate resources and credit? And maybe a bit more?
10. Is my health up to the hard tasks ahead?
Richard Strug
Tuesday, December 23, 2008
What is a business plan and why do I need one?
When you take a trip, the smart traveler plans their route in advance, making sure there are sufficient rest stops, gasoline stations, hotels that accept pets [when required], and alternate routes in the event of a detour that could delay arrival at the designated destination. A business plan is a road map for the entrepreneur.
A business plan precisely defines the business, identifies goals and serves as the company’s resume. It illustrates the operational and financial aspects of a business. It assists in resource allocation, minimizing unpredicted complications, allowing owners to make good decisions. Because it provides specific and organized information about the company and how borrowed money will be repaid, a good business plan is a crucial part of any loan package. Additionally, it tells personnel, suppliers and others about company operations and goals. Business plan formats are fairly standard; the same format may be used by someone who wants to start an electronics firm as a person seeking to start a daycare center.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
A business plan precisely defines the business, identifies goals and serves as the company’s resume. It illustrates the operational and financial aspects of a business. It assists in resource allocation, minimizing unpredicted complications, allowing owners to make good decisions. Because it provides specific and organized information about the company and how borrowed money will be repaid, a good business plan is a crucial part of any loan package. Additionally, it tells personnel, suppliers and others about company operations and goals. Business plan formats are fairly standard; the same format may be used by someone who wants to start an electronics firm as a person seeking to start a daycare center.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, December 16, 2008
How do I obtain a loan from the SBA?
When you apply for a loan to start your new business or to expand your current business and are unable to secure that loan from a bank, assistance could be available from the Small Business Administration (SBA).
The SBA does not provide funding for direct loans nor does it provide grants/low interest rate loans for business start-up or expansion. The SBA does, however, enable its lending partners to provide financing to small businesses when funding is otherwise unavailable on reasonable terms by guaranteeing major portions of loans made to small businesses. The eligibility requirements and credit criteria of the program are very broad in order to accommodate a wide range of financing needs.
Here's how it works: When a small business applies to a lending partner for a loan, the lender reviews the application and decides if it merits a loan on its own or if it requires the additional support of an SBA guaranty. SBA backing on the loan is then requested by the lender. In guaranteeing the loan, the SBA assures the lender that in the event the borrower does not repay the loan, the government will reimburse the lending partner for a portion of its loss. By providing this guaranty, the SBA is able to help tens of thousands of small businesses every year get financing they would not otherwise obtain. To qualify for an SBA guaranty, a small business must meet the SBA’s criteria and the lender must certify that funding could not be offered on reasonable terms without the SBA guaranty. For additional information, visit the SBA’s Web site (www.sba.gov/financing).
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
The SBA does not provide funding for direct loans nor does it provide grants/low interest rate loans for business start-up or expansion. The SBA does, however, enable its lending partners to provide financing to small businesses when funding is otherwise unavailable on reasonable terms by guaranteeing major portions of loans made to small businesses. The eligibility requirements and credit criteria of the program are very broad in order to accommodate a wide range of financing needs.
Here's how it works: When a small business applies to a lending partner for a loan, the lender reviews the application and decides if it merits a loan on its own or if it requires the additional support of an SBA guaranty. SBA backing on the loan is then requested by the lender. In guaranteeing the loan, the SBA assures the lender that in the event the borrower does not repay the loan, the government will reimburse the lending partner for a portion of its loss. By providing this guaranty, the SBA is able to help tens of thousands of small businesses every year get financing they would not otherwise obtain. To qualify for an SBA guaranty, a small business must meet the SBA’s criteria and the lender must certify that funding could not be offered on reasonable terms without the SBA guaranty. For additional information, visit the SBA’s Web site (www.sba.gov/financing).
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
Tuesday, December 9, 2008
Am I capable of starting a business?
We are facing uncertain economic times. Before investing in a business it is of utmost importance to ask yourself, “Am I ready?” To help you in that thought process, here is a question you should ask yourself:
How do I determine whether I am capable of starting a business?
Compare your skills and expertise with those who are successful in similar business pursuits. Analyze what particular attributes and operational capabilities made other businesses profitable and viable in the marketplace. Can you duplicate and surpass the capabilities that other successful businesses possess? What unique skills or edge do you possess to obtain a sufficient share of total market in the area you plan to serve? What level of capitalization, technical acumen, energy, passion, organizational strategy, other resources or equipment can you incorporate into the business to command the essential market share for viability?
Review business journals and other comparative studies that identify the requirements necessary to operate such a business. Based on your findings, develop a strategy for what should be incorporated into business operations. If possible, do a small scale sample survey and market penetration to test the waters in terms of business vulnerability.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
How do I determine whether I am capable of starting a business?
Compare your skills and expertise with those who are successful in similar business pursuits. Analyze what particular attributes and operational capabilities made other businesses profitable and viable in the marketplace. Can you duplicate and surpass the capabilities that other successful businesses possess? What unique skills or edge do you possess to obtain a sufficient share of total market in the area you plan to serve? What level of capitalization, technical acumen, energy, passion, organizational strategy, other resources or equipment can you incorporate into the business to command the essential market share for viability?
Review business journals and other comparative studies that identify the requirements necessary to operate such a business. Based on your findings, develop a strategy for what should be incorporated into business operations. If possible, do a small scale sample survey and market penetration to test the waters in terms of business vulnerability.
Richard Strug
Greater Princeton Area SCORE (Chapter 631)
Serving Mercer and Middlesex Counties
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