Whether you are looking for a side income to supplement your regular job or are hoping to start the Next Big Thing – starting a home-based business can be a great way to make more money and have more freedom at the same time. Here are four things you’ll need to figure out in order to get your home business idea off the ground.
1. Get Your Business License or Permit
The last thing any budding entrepreneur wants to is finally get their business making a little money, only to get busted by the government for not setting it up properly. Businesses get fined and shutdown every single day, and you don’t want to be one of those statistics. It could mean the difference between success and failure.
In the U.S. you’ll want to start by getting a state tax license down at your local U.S. Small Business Association (SBA) office, which will probably run under $100. In India or other countries, you’ll have to check with your local authorities to make sure you are complying with local laws and regulations.
If all you’re doing is starting a blog or affiliate marketing website, then you might even be able to operate without a license, since you aren’t selling any physical products. But check with your local government small business office just in case.
2. Update Your Homeowner’s Insurance Policy
If you will be operating your business at home, you will need to check if your homeowner’s insurance policy covers your small business. If not, you will need to upgrade it or get commercial insurance.
This is important because if something happens – like there’s a fire, flood or break-in at your home – and you don’t have the right policy, the insurance company will deny your claim. Then you’ll be forced to pay for all damages out of pocket, and that can get expensive. So be sure to follow through with this step and get the insurance you need, both for your business and for your home.
3. Choose Your Legal Structure
Legal structures in the U.S. can be pretty complicated for larger businesses, partnerships and publicly-owned corporations. But if you’re just starting a small business that you run yourself, then you will probably just set up shop as a sole proprietor or single-person LLC.
Your local SBA office can give you some information and further guidance about how to set up your home business.
4. Set Up Payment Methods
Your business will need to have ways to collect payments from your customers. If you’ll be selling items online through an automated shopping cart on a website, you’ll need to be able to accept credit card payments. Paypal is probably the easiest way to do this, but if you are also accepting credit card payments in person or over the phone then you might want to use Stripe or a similar payment processing system.
Some customers – particularly older demographics – might only know how to send money using wire transfers, personal checks in the mail, or cold hard cash. So you might want to accept a variety of payment options like these if you are doing business in a brick-and-mortar location, by mail order or by phone. More payment options will likely help you get more customers. To start, you can look into square payments to accept all major debit or credit cards.
Starting a home business is easier than ever before, and in many cases it can be done on a shoestring budget. Whether you choose to sell physical products in a retail setting, bake cookies to sell at community events, offer freelancing services or just write a blog – be sure to use these four tips to get your business off to a good start.