We compiled this list of tips on how to start a home-based business. The advice here is not your usual how-to.
With today’s challenging labor market caused by the coronavirus pandemic, it might be the perfect time to start a home-based business to supplement your income. Not only does it require a lower startup capital than a brick-and-mortar operation would entail, but it can also give you more flexibility and freedom.
Since the Internet is already flooded with “how-tos” about starting a small business at home, we have compiled a list of tips that you probably haven’t heard of before.
Table of Contents
Focus On The Solution, Not The Final Product
No matter how original and innovative your product or service is, it will not translate to actual sales if it doesn’t solve anyone’s problem or pain point. So instead of focusing on product design, a better approach is to create a solution.
Learn How To Use Social Media Marketing The Smart Way
Unlike most forms of marketing and advertising that are capital-intensive, social media doesn’t entail a huge budget, although it demands a great deal of creativity and time.
One of social media’s most effective and “free” features is geotagging, which many small businesses fail to utilize.
In a nutshell, geotagging allows businesses and social media users to tag photos, memes, videos, and other content with a specific location. Meanwhile, this is a common feature of today’s popular social platforms like YouTube, Facebook, Twitter, Flickr, and Instagram.
Geotagging is especially helpful for small local businesses because it allows their customers to find them based on location.
Always Start Small
One of the advantages of having a small business at home is the lower financial risk. Also, its flexibility allows you to keep your day job (and other sources of income) while you test the market first and tweak your product until you can establish a healthy cash flow.
Once you are fully confident in the financial viability of your home-based business, you can leave your nine-to-five work to focus on being a more involved entrepreneur.
Teach Yourself How To Do Digital Marketing, Or At Least Know The Basics.
With the new norm, digital marketing is no longer an option but rather a necessity for small businesses to remain relevant in this fiercely competitive market.
You can bootstrap some forms of digital marketing, e.g., social media marketing and content marketing, or you may also try pay-per-click or PPC, which requires a steeper learning curve.
While PPC is not free–after all, it is also called paid ad–it is one of the best forms of digital marketing in terms of ROI. This is especially true if you use negative keywords to ensure that your ads won’t be shown to consumers searching for these words, preventing your marketing budget from ballooning exponentially.
To learn more on how you can stay competitive with digital marketing and online platforms, contact LOJO Market at (916) 303-4080 or click here to schedule an appointment.
Learn From Others
You can read books related to your business, join groups with like-minded people, find mentors, attend industry conferences, and take training courses. The goal is to absorb valuable knowledge and learn from other people’s mistakes rather than experience them just to hone your insights.
Know Your Financial Options
While it is more difficult to finance a startup business than an already established one, it is still possible to find a financing option that could take in the form of small business loans, crowdfunding, venture capital investors, marketplace lending, grants, and partners.
If you’re considering local angel and venture capital groups to finance your startup, make sure that you have a “killer” sales pitch to present in their meetings.
Make Sure That You Fulfill The Legal Requirements
Small businesses at home are still required to meet legal requirements, including an accounting system, a legal business structure, licenses and registrations, and industry-related tax liabilities.
(Note: You may want to consult with a small business accountant who can help you fulfill all the legal requirements.)
Look Into Insurance
You can protect yourself from financial losses, data breaches, and lawsuits with the right business insurance.
The type of coverage you need for your home-based gig will depend on your business and industry. However, general liability insurance is often enough for small businesses in Sacramento because it covers property damage, personal injury, and bodily injury.
Other insurance coverage you may want to consider:
- Commercial property insurance can protect equipment used to run your home-based business.
- Business income insurance can cover “core” expenses like payroll in the event that you are unable to run your business.
A word of caution: Some business activities may void your homeowner’s personal liability coverage. To prevent financial loss or any glitch, make sure that you are always transparent with your home insurer.
Be Optimistic But Not Too Much
A little dose of optimism can help you stay motivated amidst difficult circumstances, but too much of it can lead to serious problems.
The general rule of thumb is to balance realism and optimism, allowing you to create contingency plans that can help you when things go south and inspire you to take calculated risks and intelligent guesswork that might translate into revenue.
"Stalk" Your Competitors
Sun Tzu got it right when he said, “if you know the enemy and know yourself, you need not fear the result of a hundred battles.”
But how do you know your enemies, er, competitors?
You can identify your competitors by learning more about your industry. Then, you can do research on Google, social media platforms (e.g., Facebook Groups), directory listing, etc. to know more about them.