Things to consider before starting your own home based business
The new wave of entrepreneurship that started to sweep the global market at the beginning of the Covid 19 pandemic empowered small time business owners and expanded local markets to accommodate a new style of ‘low investment startups’. Now more than ever, customer trends adapted to such a process in which the market was much more survivable for new players and local vendors.
This, in turn empowered ‘home based business owners’ as customers had grown used to online shopping and the convenience of having their necessities delivered directly to their homes. Thus, If you’re an entrepreneur looking for a gap to get into the business, now is absolutely the right time for it. Check here for info and advice regarding owning your own business and how to deal with growing pains.
And the dream of entrepreneurship is thus now a lot more realistic for a lot of people. This meant everyone from stay at home moms to college students wanted a share of the spoils. And surprisingly for the first time ever, a huge chunk of these ideas turned out to be a success. However, jumping head first into a business without a proper plan and risk analysis is still a recipe for disaster. To avoid making the same mistake as most new entrepreneurs and get a leg up on your competitors, go through the list below:
Verify the scope of your business
Scoping out a business is more than just doing some basic market research. Any good entrepreneur will always get to know the ins and outs of a local market and if possible become a part of the market themselves. First, analyse and decide on the type of business you want to pursue and the product you want to sell. If you want to sell locally, understand if there’s a demand for your product in the local market.
For example- as a home baker, you will probably be making cakes for people in your locality. Understand if people who live around you are likely to buy cakes for special occasions or on a regular basis. If the local market trend is not based around the impulse buy of baker items, it is likely that the scope to which your business can grow is limited. However, a market that caters to higher volumes of cake buyers can be manipulated further to further business. However, markets can almost always be influenced upto a certain degree with the right marketing.
Verify the sources of your funding
While home businesses aren’t usually capital heavy or require as much bookkeeping as other large scale businesses, sourcing the right funding and knowing how to handle capital is still just as important. Using your home as the base for your new business or basing it out of your garage will save you a lot of money. However, you will still need to have some capital to source the right raw materials and hire employees. Start up costs might also include licensing costs, insurance and website building.
Get a proper understanding on if your own investment is enough to keep your business going for a certain amount of time. If not, try to realize if you want to take other investors on and if that would infringe your business freedom to a degree you would want to sacrifice. Then once you have secured the right investment, get quotes or guarantees of investment in written format sothat you do not have to worry about last minute funding shortages or backouts.
Verify government regulations related toi your business
While starting a new business can be an exciting time in your life and you might want to get into production right away, getting a proper understanding about the required licensing and registration is absolutely essential. If you have a lawyer who is onboard with you starting your business or even a personal lawyer, ask them to look up the regulations about starting a business in your specific field. This means going through rulebooks and websites about all relevant agencies (OSHA, DHHS, FPA, EPA etc.). Once you are done with your initial read through, note down what kind of papers you need to have to begin legal production and sales of your product or skillset.
While going through these regulations, you will also be able to find a mold around which you can establish an ethical business around.
Cross check your startup strategy
Any good business has a business plan and a growth strategy. A good business plan will almost always include the following things:
- A business overview
- A market analysis
- Product/ Service description
- A pitch if you’re looking for investors
- A marketing and financial plan
An outline for how to create a business plan can easily be found online. However, once you’re done establishing your business strategy- it is important to match it against other successful businesses. Are you missing any key strategy documentation? Is your strategy based upon unrealistic estimations? Is the structure in which you created your financial strategy coherent? Researching competition and understanding what made their strategies successful will almost always start you off at a base higher than your peers.
The marketing team
No matter if you’re hiring an agency, getting your own team or just doing it yourself- marketing a business right is one of the most instrumental keys to success. A lot of the marketing strategy depends on your brand and the brand identity. Check if your brand is memorable- that is making sure that your identity (and your logo) is unique and leaves an impression upon those who see it.
The second bit is all about reviewing your marketing strategy. Good marketing not only makes your brand even more household, but also help you consumers move on from ‘first time bias’ while making their initial orders.
Once you’re done reviewing all your factors, it is time to get an opinion from friends, your target market and other entrepreneurs. Remember, a good business is almost always dependent on the passion of the owner. Work hard and your home business will reach levels you’ve never thought of.
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