It doesn’t matter what type of business you’re running from home, if you don’t manage it well, you won’t stay in business. Let’s face it, about half of all businesses fail inside the first 12 months.
Usually, this is because of several factors, including poor planning, overspending on business assets, and expecting sales too high and sooner than was realistic.
1] Plan First, Execute Second
Due to the surprisingly high failure rate of small businesses run from a home office, it’s clear that planning was insufficient. Certainly, you should prepare a business plan.
This doesn’t have to be an overly formal thing and you may not even present it to the bank (though some will require it or request to see it when opening a business account).
A business plan is helpful not because of the document itself, but because of the thought that goes into it. You see, the idea of owning a business is a powerful one. But it also requires no real effort and isn’t wrapped in the tight bonds of reality either.
When you have to sit down to think through and plan each stage of the business, researching carefully what things will really cost, and how long it will take to get the first few clients (talking to or reading interviews with business leaders or freelancers who’ve done the same thing previously), it’s both illuminating and shocking at times.
Go into it with your eyes wide open. When you have researched and carefully planned things out, you know what you’re in for.
2] Get Your Money Right
Sort out your money before you begin working from home. What will become obvious is that getting deals takes time. Even if you have a few clients that you’re procuring from your current employer and they’re not too annoyed about that, those might well dry up or have to be dropped if the employer starts to raise hell about it. Without those, it will take time to market and find the first few deals.
With the possibility of slower than expected initial revenue, don’t hamper yourself with personal debts that need paying every month. Try to accelerate repayments to clear them as soon as possible. Clear up any outstanding issues so that they don’t cause problems later.
Save up enough money to cover your personal expenses for a while. It’s always best if you don’t need to take a wage from the business in the early stages to reduce the money going out the door on business expenses and salaries.
See if you can save some capital for business operations. This way, you can stay in business even if the sales grow slower than expected.
3] Streamline Your Life
Running a business consumes many hours of the day and some weekends too. Anyone who runs their own company or who is self employed spends considerably more time in the office than they expect, or more than they did in a previous job.
There’s not much work/life balance – if any – as a business owner. Certainly not in the first few years where there are too many things to get done and not enough time to do them.
To handle this reality of business ownership, it’s necessary to streamline your life. Look at what you can cut out. This might mean working out less at the gym or walking around the neighborhood instead of spending 30 minutes in traffic to get to the gym and back. With less time, optimize what you do to manage life better.
Cutting out Netflix, unsubscribing from premium cable channels or reducing nights out with friends might be necessary to find the extra time needed to launch, manage and grow your business.
At the end of the day, ask yourself where your priorities are; seeing your friends as often, or having a thriving business to support your life in a couple of years?
Success requires some short-term sacrifices. Later, when a friend in the bar or restaurant announces that you’re “so lucky” to work for yourself, you’ll be able to smile at what they don’t know.
4] Budget for the Business
The budget for your business needs to be separate from all personal spending. Plan out the balance sheet, profit and loss, and cashflow statement. Get a proper sense of where the income will come from and how much it will be. Add all business expenses into the figures.
Complete a spreadsheet to provide a snapshot of the business forecast. This is useful to see what to expect in the coming months. When putting projected income figures in, it makes you insecure about where those numbers are coming from and what their basis is.
This doubt is helpful because it provides the impetus to be honest about where customers will be found and what income is reasonable to expect.
5] How Will the Business Be Presented?
The business will require a website. What type of website depends on a number of factors. Are you offering professional services like a web designer, a photographer, an artist, or something else that can be visually presented?
If you are, then a portfolio platform is going to be a good choice to make your visual content look impactful to the viewer. When you’re going to provide mainstream services that aren’t visual, then a regular website is probably what’s required.
With a mainstream business, a standard website is required. This can be produced by a web designer. It’s important to register a domain name and have web hosting for the site so that it has its own location on the web.
These types of sites are mostly about the written word and aren’t very visual. They may have images or video embedded in some of the pages, but most of the communication is through the written copy.
A visual business for this interpretation is one where it’s often about a creative or other business person with what they offer shown visually. For instance, if you’re going to be a freelancer photographer, then a website that beautifully shows your best shots and makes perusing them very smooth is going to lead to more business leads.
By extension, when your website looks the part, so do you. For a portfolio platform, Format offers many excellent features that will interest anyone running a visual business. There’s a feature to let you create online portfolio sites to get the right look for your business. Clients can view product samples or photos and pick out their favorites.
Grabbing photos uploaded previously on Instagram to add into the portfolio happens in a snap. Or you can edit images in Adobe Lightroom and update the online portfolio with the click of a button.
Using a custom designed portfolio platform makes these kinds of features integrated possible where a mainstream business website would struggle.
A Few Other Things…
Don’t forget to set up a suitable work environment at home before you begin. It’s often overlooked, but it makes a huge difference on how productive you’ll be. Focus on reducing any external noise factors using soundproofing.
If you have kids at home, make time for them and set time blocks where they understand not to disturb you unless they have a problem.
Ensure the office has sufficient lighting and the seating is comfortable to use for extended periods. You’ll be working in the office for a good few hours a day, so it must be a pleasant environment conducive to getting things done.