Useful Tips When Starting Your Own Home Business: Part 1- Your Idea

Welcome to Part 1 – Useful Tips when Starting Your Own Home Business!

Over the next 6 weeks I’m going to be giving anyone considering beginning their own home business some helpful tips and advice – things which I would definitely have found useful when I set up super-cool-gifts over 3 years ago.

I’m going to break it down into 6 areas:

Part 1 – Your Idea

Part 2 – Getting Prepared

Part 3 – Advertising

Part 4 – Record Keeping

Part 5 – Organisation

Part 6 – Keeping the Energy Up

I hope you enjoy the series, look out for the other parts coming soon.

Part 1 – Your Idea

So, you’ve been considering starting your own home business. Maybe you know you need to get out of a 9/5 or shift work to better fit with your family and other commitments, maybe you just think you would be happier working for yourself. It’s a big scary step to take, especially if you rely on that income to pay your bills, so it is vitality important that you do the background research and make sure your business is viable before you lose the certainty of that regular income every month.

Tip 1 – Make sure you LOVE what you will be doing

Setting up your own business is tough. you will put in hundreds of hours of work initially and sometimes it can seem like the light at the end of the tunnel is almost non-existent. Believe me, when its midnight and you’ve just stopped working, you are exhausted, and you know you need to get up at 5am to start doing the same thing all over again, if you don’t positively love what you do, you are going to start regretting it. If you start to regret it, you won’t put all your energy into it, and if you don’t give your business 110%, it won’t succeed like you need it to. So many people get up every day to do a job they hate – don’t end up being one of them!

Tip 2 – Make Sure You Are Doing Something You Are Good At

You might spot a niche in the market for an excellent work from home business. You can see the potential in growth, how it would work around your family life and the pound signs in front of your eyes, but guess what, if the business you can see working is painting cartoon characters on a kid’s bedroom walls but your 3 year old has more artistic talent than you, it’s not goning to work. At best you would have unhappy customers, at worst no customers at all! So choose to do something you are good at. Look at your strengths. What do you do well at in your current job? What do people compliment you on? Is there something you can teach other people – something you’ve done for years and can do with your eyes closed that they would love to know? Is there something you are good at that is potentially pretty complicated / hard work / requires some skill, that would be a relief for other people to get you to do for them for a fee?

Tip 3 – Research Your Market

Probably the most important point – you might be doing something you love, and you might be fantastic at doing it, but if there is no market for it, you won’t sell it! You need to judge your market and your competition.

How many other people are doing the same thing you intend to?  Is no one doing the same thing as you? Is there a reason why? If you are setting out as a dog groomer in a town with no dogs, you’ve got a problem! Check that there is a market for the product / service you are selling. If no-one wants it, you won’t get any buyers!

Equally, check that the competition isn’t so intense that you can’t compete. If you are constantly undercut for the exact same item and service, people will go to the cheaper price. This doesn’t always mean you need to be the cheapest, but if you aren’t, check that you are offering the customer something extra for the extra they are paying. Competition on Ebay where I predominantly sell can be tough, but usually there are enough customers that items sell anyway. I also always make sure my Customer Service is second to none – i offer free 1st class P&P to the UK and signed for postage for free when orders are over £15. I offer recorded delivery abroad, and my orders are sent same day in most cases, even on a saturday. I answer queries as quickly as i can and I am helpful as I can be, so that even if I aren’t necessarily the cheapest on every occassion, hopefully the potential customers will recognise the added value.

Tip 4 – Make sure your figures add up

How are you financing setting up your business? I was lucky, I started super-cool-gifts  with just £500 and I’ve consistently re-invested the money back into the business to buy more stock. Even now, I reinvest and widen my stock base all the time so my business grows in size.

Are your items making a profit after all your expenses – and how many individual items / services do you need to sell each day / week / month / year to make enough to replace your wage? Make sure you have targets, and decide on a contingency plan if breaking even takes longer than you expected.

A good way to negate the risk of ending up broke, is to start up your business alongside your usual job. Decide on what figure of sales is your minimum that will allow you to give up the day job, and juggle (it will be a struggle!) the two until you get to that figure. However,there are pitfalls besides the obvious exhaustion at trying to do 2 jobs –  its easy to get used to having (and spending) 2 incomes for a short period and your ‘minimum’ sales may suddenly not seem enough to fall back to. In this case, it’s important to remember the other non-monetary reasons you wanted your business in the first place.

Hopefully this has given you some extra points to think about, do you have any questions? feel free to ask them in the comments 🙂

Look out for Part 2 – Getting Prepared, coming next week!