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Building a Profitable Home Based Business
I’m typing this post from my balcony in St Thomas. I own a three-bedroom condo here and visit this island several times a year for extended periods of time. St Thomas is a wonderful place. The temperature is almost always between 77 and 82 degrees Fahrenheit during the day, generally not a cloud in the sky, and the frequent tropical storms roll in during the night to keep to keep the island lush and green.
For me, the ability to spend endless summers here while still running a small and highly profitable business is what working at home is all about. I have my entire blog set up so that if I really wanted to, I could operate it from my blackberry anywhere in the world, typing a post like this as an email, and then sending it to a special server that will post it on this site.
While there are many lifestyle decisions to consider when you want to work from your home, if you boil them all down (aside from the profit motive-which we’ll cover in a later post), they are largely grouped into three key areas:
- A Home Based Business Built Around Another Job
- A Home Based Business Where the Owner is the Center of the Action
- A Home Based Business that Can be Run from Anywhere
1. Start and Own a Business Built Around Another Job
One of the best things about working from home is that you can build your business part time, during your off hours now, so that you can move to larger business full time later.
The Two to Three Year Rule
If your terrific business idea is ultimately a replacement for your current job, and you’re not selecting a turn key home based business that generates income immediately, you will need a plan. With the right plan and focus you can anticipate the money at home will start modestly at first and then gradually build into a very nice income to replace your money from work. You could build a six figure income in many circumstances, and in a few cases where you have built a “personal monopoly” (see my post on BUILDING A PERSONAL MONOPOLY) you could approach or exceed seven figures!
Here is the catch; most people approach starting a business working from home assuming that the effort that they put in from day one will result in a corresponding income from day one. Unless you buy/start a “turn key” business (with “payment” in either money, experience or sweat equity) then the work upfront will pay you back on the back end. If done right, your long hours on the front will result in short hours a few years later.
Here is the best part, often when you’re ready to step off the world-stage in your current hectic, stressful and non-fulfilling role, it’s entirely possible that your home based business will be ready to go to give you what you’ve always wanted, a business that generates a very nice predictable cash-flow; no politics and far fewer hours.
2. Working from the Home: When the Owner is the Center of the Action.
Some people love being the center of the action; where they, and they alone, are responsible for the successful outcome of the deal. Their personal brand is responsible for what drives the business forward. This is possibly the most common of the home based businesses because sweat equity is the input and reputation is the output. People come to you because you can do something that others cannot, or, at the very least, can do something better than others can. This has one of the highest financial reward potentials of any home based business because you become the product; and there is only one of you.
There are a multitude of home based businesses that come to mind, but intellectual property is one of the most common. Let’s say you developed a seminar where you gave participants information that only you had access to. This is the stuff that millionaires are made of. Think about Anthony Robbins for example; he is the brand. He sells products that people want (personal, spiritual and financial success), is credible (his stuff really does work) and he delivers it in a branded fashion so that you have to come to him. He is the center of the action.
You don’t need to be Anthony Robbins, but your home based business might be a product that your sell through ClickBank, or on your website, or in person. What do you know or could learn that you can put your personal stamp on that makes YOU the expert? To quote an Anthony Robbins-ism, people will receive the lion’s share of the money if they are exceptional and some of the money if they are excellent. The difference between exceptional and excellent is just a few inches. What can you do with your home based business that makes you exceptional and at the center of the action? What is your brand?
3. A Home Based Business that Can Be Run From Anywhere
A home-based business that can be run from anywhere is one that requires only you, a phone and/or a laptop. It is a business that you consciously build to follow you in your life’s other pursuits. So technically, the “home” in a home based business could be your 35th floor glass and steel condo built on the beach in Miami, the bamboo laden tropical rainforest getaway built somewhere deep in Asia, your mountain top hideaway overlooking a giant lake or other awe inspired residence that you occupy while you relentlessly pursue the “juice of life.”
This type of small business occupies a special place in its lucky owner’s heart because he or she was front-minded enough to design their business around their lifestyle instead of their lifestyle around their business. For many people, THIS is ultimate definition of freedom. You work when you want, where you want, and if you have done it right, you’ve designed a small business that makes a lot of money in the process.
I began this article by talking about where I started writing this post. Today in between the start and finish of this writing, I sailed for 3 hours, worked out twice (a 30 minute run and a Tai Chi class) and had concluded with a wonderful grilled Salmon dish here on the beach. The restaurant is on one of the single most beautiful places in St Thomas. The sky is now fire red and the sand is bleached white. I’m hitting send on this post and it will be on 101MoneyTalk.com in about 12 seconds… Tomorrow I’m taking a break and going snorkeling with the family at a nearby reef and then back here for an evening beach party.
In our next post, we’ll discuss in detail how to create businesses at home that can be built while working another job, so that when the time comes you can exit the workforce with total confidence.
Until Next Time,