Starting a home based business can be both scary and satisfying. There are plenty of reasons to start a business, freedom, security and the basic self satisfaction of knowing you did it yourself. There are even more reasons not to start a business. What if it fails, what if I lose money and how will I get customers. The truth is these are not top priority reasons to start a business. They are the things that people say are the reasons but not the actual reason. The real problem with starting a home based business is fear. If you knew that your business was going to succeed then you would do it in a second, or you just don't really want it. You have to take the first step to start.
All you really need to start a successful home based business is a few things. One is a simple business plan that covers start up costs, advertising costs, and what you will do with your earnings, such as invest back into the business or spend it. Another question is what to do if you lose money. The fact is your business will lose money, in the beginning, middle and end of your business. I am not saying it will always lose money and may still be profitable. There are all those times where you try a new advertising campaign or carry a new product and it didn't work. If you understand this, and can accept it, you will be fine. Do not spend money that should be for another expense, like your living expenses or thinking that this will be the thing that turns your business around. This is the real thing that causes most business to fail. It's not the business plan or even underfunding although those are big problems if your business lacks neither. Another reason is that home based businesses fail is because their owners' gamble their normal income trying to turn a profit. Instead of just taking it one step at a time, you think I can pay this bill next month if my business takes off.
A better strategy is to start small and take one step at a time. Pick one advertising campaign and stick with it to determine your cost per customer then decide if it is worth it to continue. Here is an example, let's say you place an ad in a local paper that cost $50.00. You have to run it four times before you start seeing a response so your whole campaign cost $200.00. If it generates 10 new customers, your cost per customer is $20.00 (200/10=20). If the average customer generates $50.00 in your pocket with a cost of $20 then it's a $30 dollar profit. You're making money keep running your ad but if each customer only spends $10 dollars, not $20 dollars then it is not a profit. Move onto another campaign after you recoup your losses. This way once you find something that works then you can build a profitable business.
All you really need to start a successful home based business is a few things. One is a simple business plan that covers start up costs, advertising costs, and what you will do with your earnings, such as invest back into the business or spend it. Another question is what to do if you lose money. The fact is your business will lose money, in the beginning, middle and end of your business. I am not saying it will always lose money and may still be profitable. There are all those times where you try a new advertising campaign or carry a new product and it didn't work. If you understand this, and can accept it, you will be fine. Do not spend money that should be for another expense, like your living expenses or thinking that this will be the thing that turns your business around. This is the real thing that causes most business to fail. It's not the business plan or even underfunding although those are big problems if your business lacks neither. Another reason is that home based businesses fail is because their owners' gamble their normal income trying to turn a profit. Instead of just taking it one step at a time, you think I can pay this bill next month if my business takes off.
A better strategy is to start small and take one step at a time. Pick one advertising campaign and stick with it to determine your cost per customer then decide if it is worth it to continue. Here is an example, let's say you place an ad in a local paper that cost $50.00. You have to run it four times before you start seeing a response so your whole campaign cost $200.00. If it generates 10 new customers, your cost per customer is $20.00 (200/10=20). If the average customer generates $50.00 in your pocket with a cost of $20 then it's a $30 dollar profit. You're making money keep running your ad but if each customer only spends $10 dollars, not $20 dollars then it is not a profit. Move onto another campaign after you recoup your losses. This way once you find something that works then you can build a profitable business.