10 Steps Before Starting a Small or Home Business

Step 1: Decide What Products or Services Your Small Business will Offer

he first of the steps to starting a small business is to carefully consider these questions:

• What do you have to offer?
• What makes you an expert?
• Do you have all of the education and skills you'll need to compete successfully in the marketplace or will you need to do some brushing up or retraining first?
• Does the product or service meet a need?
• Is this a seasonal product or service, or can you market it all year long?
• How sensitive is marketing this product or service to general economic conditions? When the economy is weak, how do you think your business will be affected?
• Will you be energized by going through the steps to starting this particular small business - is it something you'll love to do or sell - or are you just going through the motions of starting a small business to try to make some money?

The saying, "Do what you love, love what you do" should not be taken lightly. Your business is going to be your livelihood - you should have a good time doing it. If not, it will be difficult to get motivated at times.

If you are excited about your business, your customers will notice and it will be easier to get them excited, too. Plus, completing the steps to starting your small business will be fun and much more enjoyable.

Step 2: Know Your Market and Your Competition

When you are starting a small or home business, understanding small business marketing concepts, like getting a handle on the potential market for what you small business will have to offer and the value proposition of your small business is very important. Here are a few things to consider:

• Who is going to buy your product or service?
• Will you market to businesses, to consumers, or to both?
• What traits do you think your "typical" customer or client will have?
• Is the need for your product or service not currently being met or is it already saturated?
• Is there something about what you have to offer that will allow you to beat your competitors?
• How will you differentiate yourself from your competition?
• What is your value proposition? What is your competitive advantage?

More on small business marketing basics and on Internet marketing.

Step 3: Make Sure You Can Do the Tasks Needed Before Starting a Small Business

Before starting a small business, you need to understand and carefully consider that you'll have a lot of daily tasks that will need to get done. If you can't do them, who will? If there's no one to take care of these tasks properly, is it worth starting a small business?

Answer this question honestly. Can you handle the day-to-day general tasks that starting a small business requires, like:

• setting appointments
• ordering supplies
• bookkeeping
• marketing
• filing
• answering the phone
• checking and replying to e-mail

If you'll have help, great. If you can afford to pay someone else to do some of these tasks for you, all the better. But a great majority of home businesses are a one-person operation starting on a shoestring budget, and most other small business are not much larger and don't have substantial budgets to hire help. That means there's a good chance you'll have to do everything or it just won't get done.

You'll want to think twice about starting a small business if you are going to be run rugged with the mundane tasks to the point that you won't have adequate time to do the things you love that will make you money.

Step 4: Make a List of What Needs to be Done to Prepare Your Home for Business

Create a Home Office

With the product or service you have in mind, can you handle the business from your home the way it is right now? If not, what do you need to do to get it ready?

• Will you need space for inventory, supplies, records and/or equipment?
• Do you already have an area you can use for your office or will you need to bargain with another member of the family to give up some space?
• Is the nature of your inventory or equipment such that special climate needs must be accommodated?
• Do you need to add a room, enclose a patio, convert a garage or basement, or stake out the attic?
• What kind of power needs will you have and will you have to make any alterations to accommodate them?

As you determine what you'll need, keep track of your estimate costs because you'll need them later in this exercise.

Step 5: Understand Legal Barriers to Starting Your Business

Check you’re zoning laws before starting a small business.

If you live in an area that is subject to the rules and regulations of a homeowners' or community association, check for restrictions. Find out what, if any restrictions exist on starting a small business in your home and how you might work within them before you invest one cent in your home business.

If you plan on starting a small business in your home, you may not be able to do so if you welcome clients or customers into your home, if you will be operating machinery, storing or working with hazardous materials, making noise, etc. These and other issues surrounding the nature of your small business may all have an impact on what you can and cannot do and can prevent you from starting a small business at entirely.

Will you need a special zoning exemption? Will getting one be a difficult and drawn out exercise? Is it even legal to operate the business you're planning? Will you need to secure a license before starting your small business?

Step 6: Review Your Small Business Insurance Needs

When you go into business, you'll potentially be exposing yourself, your home and your family to a variety of risks. You need to think about how you'll manage those risks and find out if you need small business insurance to help handle them before it's too late.
Consider this:

• Will you need health insurance? If so, how can you get it and how much is it going to cost? When one spouse is still working, the ideal situation may be to get the other included on the working spouse's health insurance coverage if you can. If not, either the cost or the lack of availability, or both may prevent you from starting your business. More on health insurance...
• If you're carrying inventory, need equipment or are storing hazardous materials what kind of property insurance will you need to avoid suffering financial hardship? Will you need a small business insurance policy for this purpose and how much will it cost?
• Will you need liability insurance? Where can you get liability coverage under a small business insurance policy and how much is it going to cost? Will you need errors and omissions coverage?
• What about your auto insurance? Will you be using your car for business?

Remember, your homeowners' and auto insurance policies weren't designed to cover your small or home business. Your best bet is to shop for small business insurance that can help you manage your exposure to loss, so do your small business insurance and health insurance shopping ahead of time to save aggravation and surprises later.

Small business insurance can be a major expense of doing business, but some coverage’s like General Liability may be quite reasonable depending on the nature of your business.

Record any small business insurance cost estimates for this step - you'll need them to determine your startup and operating costs.

Step 7: Learn the Risks and Benefits of the Legal Forms of Business Organization

Before you start a small or home business is the time to understand the various legal forms of business organization. Will you operate your business as a sole proprietorship, a limited liability company (LLC), an S corporation, a partnership, or a full blown C corporation?

You'll want to research issues surrounding the legal form of business organization carefully now, because your decision will affect your startup costs. It will also affect your tax situation and your personal liability for the actions and debts of the business. Take advantage of the IRS for free tax information on the various legal forms of business organization.

Finally, your decision on which legal form of business organization you will use will largely determine what steps you need to take in order to set up your business when you're ready to do so.

Step 8: Determine Your Startup Costs

Calculate your startup costs - the amount of money it's going to take to get up and running. At this point, many of your items are going to be nothing more than estimates, but do the best you can.

By completing the previous steps you should have a much clearer picture of your startup costs than before you started this exercise. Here are some additional questions that may help you not to overlook something:

• Will you need to hire specialists, like a lawyer or an accountant?
• Will you need to buy some office furniture or equipment?
• What supplies will you need on hand for Day One? Do you need to purchase a beginning inventory?
• Are you going to buy a business or franchise?
• Will you have construction costs, and if so, how much needs to be done by professionals and how much can you do yourself?
• What can you do to lower your costs?

Take your time with this step. Do some price checking and look for legitimate bargains. You're bound to think of things and adjust your estimates all the way up to your opening day.
The closer you get to opening day, the more accurate your estimate will be.

Step 9: Consider Your Break Even Point, Your Cash Flow and Your Funding Options

There are several issues questions you need to consider with this step:

• How much will you need to pay your bills until the money starts coming in from your home business?
• Will you be keeping your full-time job or is there another breadwinner in the family that can help you until you develop an income stream?
• What will your continuing outlays be for items like equipment, salaries and/or inventory?
• How many products must you sell or how many hours of service will you need to provide before you reach the break even point?
• Where will the money come from? Will you need to borrow or draw down a savings account or sell some investments and/or assets?
• Will you need a silent partner to help provide working capital, especially until you reach your break even point and being making a profit?
• Are you willing to use your home equity to finance your business?
• Have you checked into SBA loans from the U.S. Small Business Administration?
• Is there any possibility of getting a grant to start your business?

Knowing these answers will help you decide if you can act now. If not, it can also help you to plan to secure the money you need and help you set a target startup date.

Step 10: Gauge Your Family's Support for Your Home Business

Hopefully you won't leave this step for last, but doing so won't diminish its importance.

Members of your family, at least those still at home or any family members, who may need to make sacrifices or lifestyle changes in order to accommodate your business, need to know what you're up to and how it might affect them. If you have a spouse or significant other or children living with you, your Home Business will be a big part of their lives too.

Communication is key to helping them understand. Ask for their support – you'll find that's much more effective than demanding it. Try to understand where they're coming from. If they have questions, issues, or objections, discuss them openly. Caring and open discussions now help you avoid problems later.

Couples who plan to operate a business together need to have a pretty good idea in advance if that will work for them. It's a good idea to discuss who will be responsible for specific tasks. If you can't agree on this now, there's a very strong likelihood you won't agree on it later.

Don't let your business damage your family relationships. We all need an occasional getaway and we all need to keep our priorities straight.

A strained family situation is bound to show in your Business activities - work hard to keep everyone happy!

By “Randy Duermyer”

Crucial Things to Consider Before Starting Your Home Business

Is it time to hang up the stilettos or the wingtips?
So you have this great home business idea and dream about the day when you can walk into your boss’ office and tell him or her to shove it. Before taking the official leap off the corporate ladder and onto your kitchen table, here are a few basic things you should think about before starting your home-based business:

1. Do everything in its proper order: Before you go out and set-up an LLC or spend a bunch of money on home office equipment and supplies, make sure there is a market for your product or service. There is story after story of starry-eyed entrepreneurs who are motivated to run a home-based business, but have a product that is akin to men’s spray-on hair (oh yes, we all remember seeing that commercial!). Take time to research existing products you may want represent or refine the service or skill you would like to take out to the public; because as lofty as your intentions are, a successful home-based business all boils down to whether or not you have someone who wants to buy what you are selling.
2. Dedicate space and time: It is that whole “working in your bathrobe” cliché that appeals to so many home-based business coveters. In reality, it doesn’t matter what you wear to the home office, but rather, where and when that “home office” will appear. It is all a balance. To be successful, especially when you have a business that involves speaking to customers or vendors, it is important to set aside normal business hours away from distractions or screaming kids. Customers do not want your personal life popping up into their business relationship. You must ensure professionalism by being thoughtful and protective of the “business” time and area within your home.
3. Marketing 101: Unlike Kevin Costner’s famous movie line: “if you build it they will come”, customers don’t just appear. One of the biggest reasons home-based businesses fail is because the owner does not want to sell. It is crucial to do a gut check before delving money and resources into a home-based business. Ask yourself this question before going too far down the rabbit hole: “do I have it in me to spend my time prospecting for customers?” If your answer is yes, you are ready to take things to the next level. If the answer is no, I would strongly suggest revisiting the reasons you decided upon a home-based business. In addition to selling, it is important that proprietors learn about other ways to market their products or services. Take time to understand how you can use online marketing tools like social media, email or search engines like Google to help market your products.
4. Plan for the worst: I would like to think that I am the eternal optimist, but I have learned in the small business world that it is just better to prepare for the worst just in case the sky does start to fall. For instance, Uncle Sam may not audit you, but you should run each year’s books like he will.
   
   Another area that can come up worse than expected is start-up costs. Starting a home-based business is much less expensive than investing in a traditional business, but it is still going to cost money out-of-pocket. Be realistic in how much money you will need to contribute. It is difficult to get a business off on the right foot if it is under funded to begin with.

Marketing expenses are another section of the business that can run out-of-control if not monitored properly. Before beginning a home-based business, research the required and necessary start-up expenses and plan accordingly.

5. Expect the best: Unlike the previous delve into pessimism; it is very important to bring positive energy and passion into your business. Another reason home-based businesses can fail is because their founder loses steam. How many of us know a friend or colleague who started selling something out of their home and has since stopped? Find a product or service you are passionate about and run with it like you are being chased. Continue to motivate yourself by learning new ways to sell or market your product. Take outside courses that will teach you skills you can use within your business. Just because your business is being run out of your home doesn’t mean you treat it as casually as your new work attire.

By : “Mindy Lilyquist”

Home Business Articles

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Are you making any money with your computer yet?

earliest a home based business is a unbelievable way to earn supplementary income fraction time or full time. You can build a six figure or higher residual income
using your home computer and a few hours of your spare time each week. It is estimated that each day nearly 200,000 new people log on to the
Internet for the first time. Many of these people are looking for a home based business.


Some of these people will go on to create incomes equal to or exceeding their current pay from their jobs. You require very little capitol to
begin a home businesses and you can work the hours that are best for you.


Increasing an occasion mindset is key to your business success. Your business success is largely determined by your thoughts. If you believe
that you can be winning in your business you will be. Henry Ford once said “ if you believe you can or you can’t your right.”


Self-motivation and keeping an positive perspective is vitally important. You must possess the desire to succeed and take action everyday
regardless of what obstacles you encounter along the way.


Your level of success will depend on the time and attempt you are willing to put into your business. To reap the greatest return on the time you
invest you must keep a positive viewpoint and sustain the belief that you will finally succeed.


The author Norman Vincent Peale once said, “We tend to get what we expect.” Are your expectations for your business ones of great quantity and
reward for work well done?


Everyday you must plant mental seeds of prosperity into your mind and nurture them. We become what we think, therefore build up the thoughts
that will create the type life you want to live. The key difference between a successful person and an unsuccessful person is their behavior


Develop the habit of being a power of brainpower and positive expectancy in your business and interactions with others. Cultivate patience and practice
the work habits that will get you the results you wish.


The mind is goal-seeking machinery. Set large goals for yourself and work daily on achieving them. The purpose of setting goals is for you
to decide exactly what it is that you want. You must clearly understand where you want to go before you can expect to arrive at your goal.


The philosopher Aristotle wrote that all behavior is “teleological” or purposeful- expected at a goal. The one factor that governs your
actions is your wish that you would be better off than you would be in the absence of your actions.


Stay positive and focused on your home business goals continually reminding yourself of your purpose. Whatever we continually focus on becomes our reality.
Spotlight on where you want to be and that is the way you will go.

Building Your Home Business Opportunities

Having the desire to create a home business opportunity and being in the position to actually do that are two different things. There are a few questions you should ask yourself before you quit your job and start a home business of your own. Be real with yourself before you start setting things up and building your home business opportunities.
Take the time to ask yourself a few questions before you make a decision. The first thing to ask yourself is do you think you are ready to start a home based business? Confidence will play a big part in the success of your home based business. You have to believe that the home based business is worth starting in order for it to do well.
Would others say that you are a prime candidate for self-employment? Sometimes we can be a little overconfident about our own skills. However, when it comes to whether or not you will do well with self-employment, you need to be honest with yourself. Think about how you work at your current job? Are you someone who completes tasks no matter what? Do you work just as hard at work whether or not your supervisor is in the office or not? If so, you may have what it takes to get a home based business off of the ground.
There are other questions you should ask yourself. Have you ever taken courses or seminars about starting and managing a small business? If you have not, consider doing this before you start a home based business. You will learn valuable lessons about some of the underside of having a business that you manage on your own.
Are you ready to lower your standard of living while the business gets off of the ground? Home businesses opportunity are great ventures but the majority of small business owners start off working a ton and making only a little bit of profit. You should make sure that you have some type of back up income to keep you a float while you build your home based business.
Are you ready for long hours that often will produce no immediate profit? Working long hours at a job where you are getting overtime or a steady salary is quite different form working long hours at your start up home based business. You will not necessarily see a profit from the long hours that you put in. Of course, there is a bitter sweet feeling for working long hours. At the end of the day, after the long hours, you will have a home based business that is yours.
Have you contacted a business coach or counselor about your business plan? There are so many different aspects of owning your own business. There are legal issues such as what type of business you want to have, the break even point for the home business opportunity, how a business loan impacts your credit and if you need a special license or permit for your business. Getting valuable advice about all of these things can help save you time and money.

Home Business

If you are a small business in today's consumer-driven world, you understand the need to accept credit cards as payments for customer purchases. In fact, offering the ability to accept credit is no longer an option, it is a necessity, especially when you consider that according to a recent report at CreditCards.com as of the end of 2010, there were an estimated 488 million credit cards in circulation in the U.S. Add to that the number of debit cards out there, and the total comes in at roughly 520 million cards. With over 176 million buyers using those cards on a regular basis every year, what business can afford not to accept credit cards?

But what happens to many small businesses is they realize they need to accept credit, but are unsure how to go about it. With so many options available today it's important to do your homework.

Here are tips to finding the right merchant account provider for your small business:

1) A good starting point is to first outline what your needs are now, and what you anticipate them to be as you continue to expand your business. Pay special attention to how your customers currently buy products or services and where you generally meet your clients. Do your clients visit your shop, buy out in the field, on your website, etc.? Knowing this helps you decide on the type of credit card processing plan you need. For example, a small business that operates solely in a traditional store or office setting, will have different needs than say a business that operates out in the field such as massage therapists, trade show and flea market vendors, artists, electricians, landscapers, etc. And these needs will differ from the business that solely does work online. Knowing this ensures you get exactly what you need to make it work.

2) After you know what your needs are, research options and features and then compare providers in order to determine the best online credit card processing company for your business. You now know how your buyers buy from you, so consider what methods of payment would work best for you. Determine if you need to accept credit cards over the phone, need swipe capabilities, a virtual terminal, etc.

3) If you want to accept payments over the phone, look for a company that offers cell phone processing as well as credit card processing on the popular smart phones such as iPhones, Droids and Blackberrys. Also, keep in mind that even if your business doesn't regularly work out in the field, you can benefit with the ability to accept credit over the phone. According to industry association CTIA as quoted recently in Sun Sentinel, wireless data revenues totaled $46 billion in 2010, up from 41.5 billion in 2009 and 32.3 billion in 2008. That being the case, using a mobile card processing system can increase overall sales revenue for your company; some sources report by as much as 30-100%. Now that's what you need to grow your business.

4) While comparing companies, look to see what additional options are available. One example of this might be swipe capabilities for your cell phone. This allows easy processing by swiping the credit card rather than entering the card numbers by hand. Not all companies offer this; so if mobile credit card processing is important for your business, find one that does.

5) Also, take into consideration your invoicing needs. Do you need online invoicing capabilities that will allow customers to easily create, track, and send invoices and accept credit card payments instantly.

6) Rates are also an important consideration. Make sure you compare rates to make sure that you are getting the best company for your needs. Also, look for the overall pricing. Many companies promise the lowest rates, but when you factor in all the extras you actually end up paying much more. A few select companies (such as CellCharge, Inc.) will give you a comparison of your current rates and what they offer to see if they can provide better coverage. That's a great way to determine that you are getting the best possible rate for your needs.

7) Lastly, look for the providers that offer ease of setup, great customer service and tech support, and a variety of products and features to best serve the needs of your particular business.

The bottom line is that it's not enough to offer great products and services. You need to make it easy for your customers to do business with you. Using the right credit card processing company is one way to ensure that you are providing your customers with the best service available. Remember, look for the best online credit card processing company by reviewing all that they offer, then sign up, and begin growing your business today.