By Hannah Whittenly
Owning a home business counts as a bucket-list item for many a would-be entrepreneur. Maybe you dream of being a business owner yourself. However, you feel cautious about opening up a business of your own. After all, you know the statistics: Eight out of 10 businesses fail. However, failure doesn’t have to be your reality. If you really want to own your own business someday, here are four steps you can take to ensure the success of this future endeavor.
1. Sell What People Want
Many people start a business because they love the product or service they’re selling. Unfortunately, if it’s not a product or service that others want, the chances of success for those types of businesses are slim. According to Entrepreneur, the most successful businesses capitalize on products and services that already exist in the marketplace but do so with a twist. These new business owners find a niche within the broader category of business that they’re in. If you’re going to start a new business, ask yourself if you’re selling what people want. If you’re not, try to figure out a way to adapt your product or service to that.
2. Watch Your Overhead
While it might be nice to have a cool office space, with a big desk and an employee or two, you need to ask yourself if you can sustain that kind of overhead. If not, then your business is probably doomed to fail.
Instead of going for the luxury set-up straight out of the gate, why not see if you can make better use of the current space you have right now, your home. You’ll have to be creative, but it is possible. For example, entrepreneur Stacie Lucas lives in a small home—think nearly “tiny”—in the San Francisco area. On the Extra Space blog where it talks about working smarter, however, she says that she manages to run her clothing company, Amae Co, out of her 1,000 square foot home and plus some shared studio space. By doing this, she keeps her overhead down and she has extra money to travel with her family to boot.
3. Create a Business Plan
A business plan tells you and your potential investors where you see your business going and how you plan on getting there. It also forces you to keep your business goals in sight. A business plan should help you project how you’re planning on getting the cash flowing, an important consideration if you want your business to last. When you’re developing your business plan, it’s wise to underestimate how much you’re going to make and overestimate how much things will cost when you’re working on your business plan. That gives you some wiggle room.
4. Market, Market, Market
When some people open a business, you’ll never know it. They don’t advertise and market, which is a mistake. Your business will need constant cash-flow and new customers to keep afloat. Marketing and advertising are the tools you need to use to bring those business assets in. While you may not be able to afford the biggest advertising budget, you can advertise, even if means doing it for free on social media or by doing some content marketing. People can’t buy from you if they don’t know you exist. Make it easy for them to know you exist.
Owning a home business requires work and sacrifice, but many people find the prospect exhilarating. If you’d like to own your own business, starting in in your home is logical. It helps you keep expenses down by saving you money on office space. Additionally, starting a home business allows you to work within a niche of a business you like. Finally, with the right marketing and business plan, there’s no reason why your business couldn’t make money over time.
Hannah Whittenly is a freelance writer and mother of two from Sacramento, CA. She enjoys kayaking and reading books by the lake.