Time spent in quarantine, for many individuals during the COVID-19 pandemic, presents the rare opportunity to start a work from home business. There are many types of small businesses entrepreneurs can start from the comfort of home. Here are a few popular options.
- Writing, editing, and blogging
- Coaching/starting a consulting business
- Software programs
- Virtual assistants
- Audio transcription services
Launching a work home from home business is similar to opening a brick and mortar storefront. Entrepreneurs must be able to check off the following items as they start their business.
- Understand your “why” for going into business and the viability of your idea.
- Choose a business model.
- Draft a business plan.
- Incorporate as a business structure.
- Register for trademarks.
- Obtain an Employer Identification Number (EIN).
- File for the proper licenses and permits.
- Create a website and social media profiles.
If your work from home business is the company you always dreamed of starting, we want to help you make that dream a reality. Follow these steps to start and maintain your new small business.
Understand Your “Why” For Going Into Business
Every entrepreneur has a different reason why they chose to start a business. Some of these reasons may include the following:
- You want to make a difference in your community.
- You have an idea that can truly change lives for the better.
- You are naturally passionate about this endeavor and want to pursue it.
Rebecca Lake, freelance financial writer and blogger at Boss Single Mama, chose freelance writing as a creative outlet. In 2011, Lake left her corporate sales job to stay home after the birth of her second child. She enjoyed fiction writing, but chose personal finance as her niche because she was interested in learning more about money management.
Lake was able to continue growing her freelance business by setting clear goals. “Setting goals that were specific and actionable is what helped me to grow my business and income over the past several years,” Lake says.
This is also true of starting a work from home business. First, understand your why. Then, set short- and long-term goals for the business. These goals should be achievable and challenging.
How Viable Is Your Business?
After setting these goals, ask how this idea can become a viable business. Before you get going, ask yourself what makes this idea unique. Figure out how the company can make life easier for others. You may also ask what makes you qualified to turn this idea into a successful business.
This is a strategy Lake used in growing her freelance writing. She gradually became an expert in her niche. Keep in mind that this process does not happen overnight. However, Lake notes it’s a powerful way to grow your business and level up your income.
“Once you’re recognized as an expert in your niche, you’ll reach a point where clients come to you. They will offer you work, rather than having to go out looking for them,” Lake says.
In further determining the viability of your business idea, you should be able to build a community of support. This will allow you to receive unbiased feedback. Depending on your company type, you may even incubate this idea at business incubator organizations.
Choose a Business Model
Earning a profit may not be the sole reason why you start a work from home business. However, your company should have the ability to show it can make some money. This allows your startup to be built on a business model, which may be defined by four factors.
- Differentiation and pricing. How does your work from home business provide the best customer experience at a competitive price?
- Marketing and sales. A wide variety of media, including advertising, social media, and print, may be used to market your offering to interested audiences.
- Production and delivery methods. This outlines how the offerings are produced and delivered to customers.
- Customer satisfaction. Your business will continually work towards this goal. Throughout the customer experience lifecycle, you’ll look for ways to keep reaching, and anticipating, their needs.
Draft a Business Plan
This document acts as a blueprint for which your business will be able to reach its goals and milestones. Entrepreneurs that start a work from home business have options for drafting business plans. They may draft a traditional business plan or a lean business plan. Let’s take a look at the elements found in each plan.
Traditional Business Plan
- Executive Summary
- Business Description, Concept, and Strategy
- Industry Analysis
- Market Analysis
- Organization and Management
- Financial Projections
- Financing Request
Lean Business Plan
- Value Proposition
- Key Partnerships, Resources, and Activities
- Customer Segments, Channels, and Relationships
Incorporate as a Business Structure
You understand your “why” for being business. You have a draft of your business plan and have a business model that will help earn a profit. This side gig is getting serious — and is ready for incorporation.
Incorporating a work from home business provides it with many benefits. Entity formations, including LLCs and corporations, protect assets through liability protection. This allows you to separate your professional and personal assets. Liability protection ensures that personal assets are not impacted due to an unforeseen circumstance.
Some small businesses, especially those with a work from home nature, may not choose to incorporate as a legal entity. They may opt for a sole proprietorship instead, and cite the lack of liabilities to working from home as the reason why they do not incorporate. However, an unincorporated business is at more risks than you may realize. There is no liability protection available. It also becomes much more difficult to establish business and brand credibility.
Register for Trademarks
Trademark registration allows you to do more than protect your unique business names, logos, and designs. It gives you, the owner, exclusive rights to the mark. This ensures nobody may infringe upon the mark associated with your work from home business.
Before you register for a trademark, however, it’s a good idea to conduct a name search. You may search to see which names are already registered and which applications are pending for similar marks. Is your mark available? Then, you may file an application to register the trademark.
Obtain an EIN
Employer Identification Numbers (EINs) are commonly associated with hiring employees. As such, some entrepreneurs may put off filing for an EIN until they are ready to hire.
However, an EIN provides many valuable functions to small business owners. This tax ID also allows businesses to open bank accounts. You may even establish a credit profile simply by filing for this tax ID.
File for Business Licenses
Depending on the type of work from home business you are starting, you may need to obtain relevant business licenses and permits. These documents will differ depending on multiple factors, including your industry, city and state, and even your entity formation.
In a pinch, MyCorporation can provide assistance. We can contact your local Secretary of State to find out which licenses and permits you’ll need for your business. Then, we can help complete these filings on your behalf and submit them for approval.
Create a Website
As you wrap up this checklist, don’t forget to set up a website and social media accounts for your new business.
Believe it or not, 50% of small businesses do not have a website. Without a website, and social media, you’re missing out on countless amounts of visibility and engagement from potential customers. Luckily, our partners at LogoMaker are here to help you build a website with their Do It Yourself Website Package.
Growing Your Work From Home Business
Starting a business is an investment of hard work, time, and energy. Do not expect the company to explode in sales overnight. Instead, be ready to roll up your sleeves and get to work.
In addition to positioning herself as an expert in the financial space, Lake uses additional strategies to succeed as a freelance writer.
“You have to be willing to put in the time and put yourself out there,” Lake says. New freelancer writers, for example, may initially struggle to get noticed due to the industry’s competitive nature.
However, it is possible to make, and leave, your mark. In order to do this, Lake advises that you step outside the box. Market yourself to the right people — that is, those clients and companies you want to write for. Focus on how you can continue to network and build upon that network as it will be a valuable source for referrals. These individuals will refer you to new clients and companies, allowing you to build up your reputation — and the business — so it succeeds and thrives in the long run.