What you need to know when starting a home business

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Starting a home business can be exciting, frustrating and scary all at once. There are so many unknowns going into starting a home business that the new home businessperson will himself or herself constantly surprised by what is happening around him or her. There are a few important things that you should know before you start your home business, however, that will maximize your potential for success:

* Know your market. You might be the most talented acrobat on your block, but most folks won’t pay to see you on the high wire unless you join the circus. Some markets are well-served by home businesses and some are not. Likewise, if you open a computer consulting business in town of 300 people that already has two computer consulting businesses you might have some serious difficulties breaking in. Some markets are more saturated than others, and home businesses tend to do poorly in saturated markets.

* Know your trade. If you are going to mow lawns in your home business you need to make sure you know how to trim hedges and make them look decent. While you can, in theory, learn a trade while you are starting your home business, it isn’t advisable. If you are not an expert at doing what you do your potential customers will look elsewhere.

* Know your financial situation. Most home businesses don’t turn a profit right away. Many home businesses can go for six months to three years before actually making money. Don’t quit your full-time job to start a home business unless you’ve got something of a financial cushion. It is also important, in this area, to know what your credit rating looks like and what sorts of small business loans or credit programs might be available to you.

* Know your own limitations. Many home businesses fail when the businessperson just can’t find the time to do the work of his or her business. Home businesses rarely require less work than other jobs. Home business owners often work more hours than other folks. If you can’t or don’t want to work hard, don’t start a home business.

* Know what your resources are. Family and friends are often willing and even eager to help you out when starting a home business. Various governmental agencies, such as the Small Business Association have programs to assist small and home businesses as they start up. The Internet is full of advice, some useful and some dangerous, about home business. Knowing what tools you have on hand can save your home business when there is trouble.

Knowing these things doesn’t guarantee your success when starting a home business, but it does increase your potential for success.


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