If you have the ambition to start your own business, but don’t have the finances available to make your dream a reality, then why not look at the possibility of starting up your business from home? There are many types of businesses that can run well as home-based enterprises, and plenty of helpful guides on how to achieve your goals, such as the Hiscox guide to starting a photography business in nine steps.
Before you quit your day job and start your home-based business, it’s essential to formulate a basic business plan that assesses the opportunities available and makes sense of the potential costs and profits from your planned venture. Ask yourself these key questions to get a sound understanding of your chances of success:
- Do you have a marketable skill that people will be prepared to pay for? You don’t have to be the best at what you do to make a living, but you do have to have the ability to achieve a standard people will consider worthy of reward.
- Is there a demand for what you’re selling? Do people want to pay a sufficiently high price for your products or services to make it worthwhile running a business? Without demand it’s very hard to make a living from a business, so you must be confident that you can sell what you’re offering at a price that satisfies customers but gives you a respectable return.
- What investment costs do you need to make? If you were thinking of setting up a photography business for instance, how much would all your cameras and equipment cost? What about expenses like website creation and maintenance, transport, buying stock, processing costs, and whatever else you’d have to pay out for? You can claim many of these types of expenses back on your tax bill, but you’ll still have to find the money in the first place.
- Do you know enough about budgeting, tax, financial projections, profit and loss, and all the other aspects of operating the accounts for your business? Your success is intrinsically tied to your ability to manage money, and if you don’t have the necessary skills, you should engage an accountant to help you make sense of everything.
- Do you have a good understanding of how to market yourself or your product? Marketing is a vital skill, because unless potential customers know what you’re selling they won’t be able to buy it.
If you’ve been through this list and all the results are positive, you can start taking action to get your business going. Deal with all the administrative tasks and begin your attempts to bring in customers to the business before you quit your existing job if you can. That way you’ll have a little financial cushion to support yourself with before losing your employed salary altogether.