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Building a Profitable Home Based Business
This post discusses the basics one needs to consider when starting their own home based business. We will not talk about how to build a business here, this comes later, but rather we discuss getting the setup right so that you can concentrate on what is most important, the business opportunity at hand.
There are fundamental items that need to be taken care of before executing your home business launch. While many are unique, the “Top Ten” items are shown below:
Incorporation – in order to avoid personal liability, and perhaps ensure that business revenues and expenses are recognized in their most tax efficient manner, you’ll want to consider incorporating. By far the leader in this for people like you and me is THE COMPANY CORPORATION. I’ve used them and so hand hundreds of thousands of others. The COMPANY CORPORATION is surprisingly simple, and requires no lawyer, no face-to-face meetings, and they will not only take care of all of the filings for you, but they will acquire for you the all so important Federal Employer Identification Number (“EIN”) – all in about 30 minutes total of your time.
There are several company forms that can be established:
- Limited Liability Company (LLC)
- Limited Partnership
- DBA / Business Names
The most common is a single owner Limited Liability Corporation or as it’s commonly referred to, an LLC. This form provides the same legal protection to its owner that a corporation provides, but revenue and expenses are treated like a partnership, meaning that they flow through to the individual owner without double-taxation the way a C-Corporation operates. The cost to set up an LLC starts at $79 if you choose a corporation friendly state such as Delaware or Nevada (this is just the place of filing your incorporation papers, you do not need to live there). For more information go to THE COMPANY CORPORATION
Mail – You don’t want your home address on anything that the public sees. While you may maintain a home office as your primary office, and even get mail there from time to time, you don’t want a disgruntled customer showing up at your front door at 7:00pm on a Thursday night. You need a PO Box. I recommend using the Post Office instead of one of the private PO box service companies that are popping up. Post Offices generally don’t go in and out of business, and a private firm might, leaving you in a position where you’ll have to change your address with all of your vendors, customers, the Government, etc.
Additionally, you’ll want to sign up for an account at Stamps.com!. They are an approved licensed vendor of the United States Postal Service and offer end to end mail service. They have “postage on demand” so that you can print your own stamps (you can even use your logo on your stamps if you want to really impress!) In addition to the ability to print your own postage, they offer scales, exact postage rates, etc. To go to Stamps.com! click here.
Bank Account – Businesses take in and pay out money – hopefully more of the former and less of the latter . . . With your EIN in hand you’ll need a bank account. Citibank has a great small business bank account that is both free and requires no minimum balance. This account is currently called the Citibusiness Flexible Spending Account. Don’t forget to put your PO Box, not your home address, on your checks – you can still have the statements sent to your home.
Insurance – Speak to a trusted independent property and casualty insurance agent on this. Each business is different, but you’ll want options, so speaking to an independent agent who represents different providers is critical.
Computer – You need one. Chances are if you’re reading this web post your doing it from the very same computer that you’d use for your home based business. In other words, nothing fancy is needed unless you are a fast moving stock trader working from home (and if you are and have tips let me know!).
Four in One: printer, fax, copier, scanner – You need one of these too. They are cheap; you can pick one up at Staples for less than $200.
Printer Ink: You will print a lot, don’t pay full price, get up to 75% Off at 123 InkJets.com
Telephone – some people have moved to a “cell-phone only,” communication. I still don’t think the quality is there for a proper business conversation for many businesses; however, for those who don’t engage in high-powered phone negotiations on a regular basis, a cell phone number is fine – particularly if you’ve moved your home business to Hawaii and you are taking business calls from your balcony in Waikiki (we’ll talk about THIS benefit of a home based business in a later post). Just make sure that you have increased your minutes to accommodate your new business activities or your first bill will cost you a fortune.
Website – A website presence is needed for almost every business now. Many people get their start with with the world’s leader in new website acquisition and design, GoDaddy.com . GoDaddy.com has impressive end-to-end service for those who are not technically savvy. They will set you up with a website, an easy to use design template, email addresses, analytics, marketing, and Search Engine Optimization – all for a very reasonable monthly price. Currently they are offering domain registration for $3.99 .COM and Free Private Registration. to entice you to try them.
Logo – Not all businesses need a logo, but if you do, I recommend 99 Designs (they designed the logo at the top of this website). Australian based 99 Designs has a unique logo design process. They set up a contest with a large number of logo specialists globally – each of whom competes for your business by providing you with draft logos uploaded on a specially designed page for you to review. You highlight what you like and don’t like about your top choices and then the designers go back to work. Eventually, you narrow it down from 50 or 60 designs, to just a few; and then after several rounds of your feedback you finally have “the one” for final approval. I had over 30 designers competing for my logo. I loved this process.
Business Cards – These are so important. You can’t be in business without them, even if you run your business entirely from the web. Even if you simply attach them to a product when mailing it out, or hand them out at a convention, they are needed. PsPrint.com is one of the cheapest and best and is the one that 101MoneyTalk.com uses.
In the next post we’ll discuss How to Choose the Right Home Based Business. This next one will prove to be VERY interesting as we will uncover your true calling with a few simple questions.
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Until Next Time,