HBB proscons runningf home based business

The Pro’s & Con’s of Running a Home-based Business SCC BUS 209_ HBB copy Home-Basers You’re Not Alone     Estimates range between 18M to 38M HBBs in the USA Latest US Census data computed says 13.8M, with 9.7M being the household’s primary incomegenerating According to IDC (nat’l research firm), 34.3M to 36.6M in 2005 Newsweek approximates that 50% of all US households have some form of HBB Many of them make a lot of money, total estimate $427B! Do your research first to see if it is right for you and your family Why the Growth of Home-basers?  Access to Technology  Corporate Downsizing  Changing Lifestyles  Change of Professional Image & Choice HBB Advantages  You are your own Boss  You can schedule your own time  You can stay at home with the kids  Low overhead for the business  Eliminate corporate/ office politics  Tax Advantages  No commute  You can the laundry as you work   The dog won’t chew up the yard HBB Disadvantages  ISOLATION  Lack of self-discipline  Distractions  You’ll be at home with kids  Don’t know when to shut it off  Your family doesn’t truly support you  Little “tech” support  You’ll start talking to yourself  Loss of structure Personal & Family Considerations  Loss of daily structure should not be underestimated  Self- discipline is a challenge  Isolation is a problem for most people  Organization is a family challenge  Separating Home from Work is hard  Family Issues will arise  The stigma of not being “professional” My 5-year old cannot understand that this office is MY Business! Examine & Prioritize the Pro’s and Con’s: Ask Yourself the HARD questions Is it right for me now? Do I have the designated office space? Am I disciplined enough to this? Will my family support me? Can I tune it out or will this be a 24/7 job? CAN I MAKE MONEY? More Hard Questions to Ask • Is the business right (appropriate) for the home? • Is it legal? • Are their local zoning restrictions? • Are their private or property associations land-use restrictions? Property Zoning: Check with your local city planning department Normal zoning is one of four ways, each with implications for the home-baser: Residential Commercial Industrial Agricultural Isn’t it always a TAX Advantage? NO! Not Always Claiming a depreciation can subject you to capital gains taxes when you sell your home Do your homework: Contact the IRS and get Publication 587, Business Use of Your Home Do Not Overlook Insurance • According to IIA of A 60% of HBB’s lacked adequate insurance • HBB are not automatically covered by regular homeowner’s insurance • Cover Your Assets! The Approach: Getting Started Inside- Out The entrepreneur approaches the task by looking at their own skills & abilities and then determining which kind of business to start-“Idea generation” Outside-in The entrepreneur looks first for opportunities on the outside (in the market)- “opportunity recognition” Which Approach to Use? • Inside Out • Outside In • Accidental (serendipity) • All of the above? Home based Businesses Special Resources • American Association of Home Based Businesses AAHBB (non-profit) • National Association of Home Based Businesses www.homebusiness.com • Home Office Association www hoaa.com • SOHO (Small Office Home Office) www.soho.org • Local Chambers often have SOHO (Small Office Home Office) or HBB committees • Your local SBA, SBDC & College ... above? Home based Businesses Special Resources • American Association of Home Based Businesses AAHBB (non-profit) • National Association of Home Based Businesses www.homebusiness.com • Home Office... home Do your homework: Contact the IRS and get Publication 587, Business Use of Your Home Do Not Overlook Insurance • According to IIA of A 60% of HBB s lacked adequate insurance • HBB are not... of Professional Image & Choice HBB Advantages  You are your own Boss  You can schedule your own time  You can stay at home with the kids  Low overhead for the business  Eliminate corporate/