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Choosing
the Right Home Business for You
©
2002 Elena Fawkner
Pay any
attention at all to your email inbox and you'd be forgiven
for thinking that the only way to run a business from home
is on the Internet. Sure, many people are running spectacularly
successful Internet-based home businesses. Many, many
more are doing so even more spectacularly unsuccessfully.
But what if you're not interested in running an Internet business?
What if you want to start and run a home business the old-fashioned
way? Where do you start?
Actually starting any home business is the easy part. The
hard part's deciding what that business should be.
So how do you even start the process of deciding on the right
home business for you? The key is to be methodical,realistic,
objective and patient.
Step 1 : Personal Inventory
The first place to start is to inventory your skills,
experience, interests, and personality characteristics. These
are what you have to work with - your raw ingredients, so
to speak.
Make a list of personal qualities and factors that you can
throw into the mix. Include things like:
=> your personal background;
=> training and education;
=> work and volunteer experience;
=> special interests and hobbies;
=> leisure activities;
=> your personality and temperament.
All of these qualities and factors make up what you know
and what you're good at.
Step 2 : Identify What You Like
It's one thing to know a lot about something or be
good at it. It's quite another to enjoy it enough to
want to make it your life's work. So, remove from the
list you created in Step 1 anything that you don't really,
really like doing or which plain doesn't interest you.
No matter how good you
are at it. If you're lucky enough to like what you're
good at, as a general rule, stick with what you know.
Step 3 : Match Your Likes With Marketable Activities
If Steps 1 and 2 still haven't suggested feasible
homebusiness ideas, review the following activities that have
proven marketable for others and weigh them against your "likes"
from Step 2:
Crafts - pottery, ceramics, leadlighting
Health and Fitness - aerobics instructor, network marketing
for a health products company, home health care
Household Services - cleaning, gardening, shopping
Professional Services - attorney, architect, interior designer
Personal Services - make-up artist, hairdresser
Business Services - business plan writer, meeting planner
Wholesale Sales - antique dealer, dropshipper
Retail Sales - children's clothing, widgets
Computers - web design, internet training.
You get the idea. This is not an exhaustive list, obviously.
You can visit the AHBBO Ideas Page for a list of over 500
home business ideas at http://www.ahbbo.com/ideas.html .
Step 4 : Make a List of Business Ideas That Fit With
Your
Likes From Step 2
By the time you're done, you'll have a hitlist of
possible matches between your skills and interests on the
one hand and home business ideas utilizing those skills and
interests on the other.
Step 5 : Research
Armed with your list from Step 4, identify those
ideas thatyou think have marketable potential and then research
whether that belief is accurate. In order to have marketable
potential, the idea must satisfy the following criteria:
=> It must satisfy or create a need in the market.
The golden rule for any business is to either find or create
a need and then fill it.
=> It must have longevity. If your idea is trendy
or faddish, it doesn't have longevity. Go for substance
over form in all things.
=> It must be unique. This doesn't mean you have
to invent something completely new but it does mean that there
has to be some *aspect* of your product or service that sets
it apart from the competition. This is easy if you go
for the niche, rather than mass, market. Don't try to
be all things to all people. You'll only end up being
too little to too many.
=> It must not be an oversaturated market. The more
competition you have, the harder it will be to make your mark.
It's unrealistic to expect no competition, of course.
In fact, too little competition is a warning sign either that
your business idea has no market or that the market is controlled
by a few
big players. What you want is healthy competition where
it's possible to differentiate yourself from competing businesses.
This all gets back to uniqueness. If you can't compete
on uniqueness, you must compete on price (or convenience).
If you're forced to compete on price alone, that just drives
down your profit margin. Not smart business.
=> You must be able to price competitively yet profitably.
The price you set for your product or service must allow you
to compete effectively with other businesses in your market,
it must be acceptable to consumers and it must return you
a fair profit. If any one of these three is off, move
on.
=> Your business must fit with your lifestyle. If
you're a parent of young children and you primarily want to
start a business from home so you can stay home with them,
a real estate brokerage business that requires you to be out
and about meeting with prospective clients is obviously not
going to work.
You'll instead need to choose a business that can be conducted
entirely (or near enough entirely) from within the four walls
of your home office. Similarly, if your business idea
would involve having clients come to your home, you're not
going to want an unruly 3 year old underfoot as you're trying
to conduct business.
=> Your financial resources must be sufficient to launch
and carry the business until it becomes profitable.
No business is profitable from day one, of course. But
some are quicker to break even than others. If your
business requires a considerable initial capital outlay to
start - computer, printer
and software for a web design business, for example - it will
take you longer to break even than if the only prerequisite
was the knowledge inside your own head, such as working from
home as an attorney.
If your financial situation is such that you can't afford
to quit your day job until your business is paying its way,
this, too, will mean it will take longer to break even than
if you're able to devote every waking hour to your business.
Just do what you have to do. That's all any of us can
do.
Step 6 : Business Plan
Once you've gone through the above process and identified
what appears to be the right business for you, the final "gut
check" is to write a business plan for your business, much
as you would for a presentation to a bank for financing.
Include sections for strengths, weaknesses, opportunities
and threats, and set goals for what your business needs to
achieve for you, by when, and how you are going to get there.
There are plenty of good resources online about how to prepare
a thorough business plan. A great place to start is
at About.com (http://www.about.com).
Just type "business plans" into the search box.
Although it may seem like a waste of time and effort to complete
a business plan if you don't intend to seek outside financing,
taking the time and exercising the discipline neededto really
focus your mind on the important issues facing your business,
you will be forced to take a long hard look at your idea through
very objective and realistic eyes.
If your idea passes the business plan test, then you can be
reasonably confident that this is the right business for you.
If you come away from this exercise feeling hesitant, uncertain
and unsure, either do more research (if the reason for your
hesitancy and uncertainty is lack of information) or discard
the idea (if it's because you don't think your idea is going
to fly). If this happens, just keep repeating Steps
5 and 6 until you end up with an idea and a business plan
that you're confident is going to work!
Although it's frustrating to wait once you've made up your
mind to start a business from home, this really is one situation
where the tortoise wins the race. By taking a methodical,
systematic and disciplined approach to identifying the right
home business for you, you give your business the best possible
chance for long-term survival, hopefully avoiding some very
expensive mistakes along the way.
Elena
Fawkner is editor of A Home-Based Business Online ... practical
ideas, resources and strategies for your home-based or online
business. http://www.ahbbo.com
The Secretarial
Business-in-a-Box provides everything you need to start and
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