Part I
Getting Started with Your Home Business
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In this part…
Find out what’s involved in starting and running a home business.
Decide whether to start from scratch or buy an existing business or franchise.
Write business and marketing plans.
Get funding from different sources.
Choose a legal structure for your business.
Start to understand your customers and what they want.
Chapter 1
Where the Heart Is: Welcome to the World of Home-Based Businesses
In This Chapter
Understanding the basics of home-based businesses
Taking a look at the pros and cons of running a home-based business
Congratulations! You’ve decided to start a home-based business. You are joining many others who have already made the decision to start a home-based business. According to the home business network Enterprise Nation, more than 2.1 million home-based businesses operate in the UK, and between them these businesses have a combined turnover of over £364 billion. Over 60 per cent of all new businesses are begun at home, with 1,400 home-based businesses starting up every week in the UK. Take it from us: owning your own home-based business may be the most rewarding experience of your entire life – and not just in a financial sense (although many home-based businesspeople find the financial rewards to be significant). Having your own home-based business is also rewarding in terms of doing the work you love and having control over your own life.
Of course, every great journey begins with the first step. In this chapter, we provide you with an overview of this book and look at the basics of home-based business – including getting started, managing your money, avoiding problems and moving ahead. Finally, we reveal some of the good news – and the bad – about starting your own home-based business and explain how to know when it’s time to make the move.
Looking at the Basics of Running a Home-Based Business
Not surprisingly, a home-based business is a business based in your home. Whether you do all the work in your home or you do some of it on customers’ or third-party premises, whether you run a franchise, a direct-sales operation or a business opportunity, if the centre of your operations is based in your home, it’s a home-based business.
Each part of this book is dedicated to a specific aspect of starting and running your home-based business. In the following sections, we take a closer look at the topics we cover in the rest of this book.
Determining the kind of business you want to have
After you decide you’re going to start your own home-based business, you have to answer two questions: exactly what kind of home-based business do you want to start and what’s the best way to market your products or services?
You basically have two types of home-based business to choose from: businesses you start from scratch and businesses you buy. The latter category is further split into three types: franchises, direct-selling opportunities and business opportunities. Whether you prefer to march to the beat of your own drum and start your business from the ground up or get a business-in-a-box depends on your personal preferences.
The advantage of a business you start from scratch is that you can mould it to fit your lifestyle and existing and emerging markets, which provides you with a boundless variety of possibilities. Businesses started from scratch account for the majority of viable, full-time businesses – in other words, they tend to be more successful over the long run than businesses you can buy.
Each type of home business that you can buy, on the other hand, has its own unique characteristics. The following sections illustrate how the three types are different from one another. We go into more detail on these three types in Chapter 2.
Franchise
A franchise is an agreement in which one business grants another business the right to distribute its products or services. Some common home-based franchises include the following:
Green Thumb (lawn-treatment service)
Molly Maid (domestic cleaning service)
Little Kickers (football classes for pre-school children)
ProKill (pest prevention)
Snap-On Tools (professional tools and equipment)
Direct ...
