5 Pitfalls to Avoid Running a Home-Based Business
Running a home-based business can be an exciting and rewarding experience. You have complete control over your hours and can choose your work. There are several benefits to running a home-based business:
- Added Income: every client you bill adds to your monthly income.
- Flexibility – One of the best things about running a home-based business is setting your hours and working as much or as little as you want.
- Independence – You are in charge when you run your own home-based business. You make all the decisions and call all the shots.
- Tax Benefits – Home businesses offer great tax benefits, including deductions for home office expenses and taxes on profits.
- Increased Productivity – When you’re not stuck in traffic or fighting for a seat at your desk, you’ll likely find that you’re more productive when working from home.
- No Commuting Costs – Another significant benefit of running a home-based business is that there are no commuting costs.
However, you should know some of the pitfalls of running a home-based business. The following are five common mistakes home-based business owners make that can be detrimental to their success.
5 Home-Based Business Pitfalls
1) Being Afraid To Fail
You must be bold to be a successful business owner. When you let fear of failure or what people think hold you back, you prevent yourself from reaching your full potential.
Adopt a growth mindset where failure is not a destination. Instead, it is a healthy step in learning something new. Recognize that you will make mistakes.
Accept the consequences of those mistakes and decide to learn from them and grow.
If you are suffering from fear of failure, consider following Tim Ferriss’s method of fear setting from the 4-Hour work week:
- Write down all the worst possible outcomes of failing.
- Write down the steps you would take to recover.
- Define the positive and negative consequences of more probable scenarios.
- Determine the cost of inaction caused by your fear.
When you define your fears, they become manageable and you can create plans to overcome them.
2) Separating Work And Family Life
Separating work and family life can be challenging when running a home-based business. It is easy to become caught up in work, work long hours, and sacrifice time with family.
This is especially true when working from home because there are no physical boundaries between home and work. A home-based business is a marathon, not a sprint—set boundaries between your time and your work time.
Build your business so that you can separate your work and family life. There will be critical times when you will need to spend time on your company, but your goal should be to develop a business that empowers your life, not one that supplants it.
As a business owner, you are the master of your destiny. If you don’t want to work past five or on the weekends, set up your business, so you don’t have to.
3) Not Seeking Help
Don’t try to reinvent the wheel. When starting a home-based business, it is essential to seek help. Find people or organizations that can give you guidance and support.
Consider joining home-based business networks and look into mentoring programs. Reach out to other home-based business owners for advice on what has worked for them.
Online courses and programs are great ways to find experts in your field and to find resources to help you get started.
4) Trying To Do Everything Yourself
Starting a business and running a business require different skill sets. In the beginning, you will need to do everything.
This is good; it teaches you the ins and outs of how your business functions. As you grow, however, there will come the point where you don’t have enough time to do all the work required.
Business owners must be able to hire and build a team that supports their mission. This will allow you to focus on the areas that need your attention and delegate tasks to others. Ask yourself:
- What is my most significant value add to the business?
- When I do everything, am I holding the business back?
- What tasks can I train someone to do on my behalf that will make the business more successful?
A couple of notes before hiring an employee:
- You must have consistent revenue before you hire an employee.
- Delete, systematize and automate before hiring an employee.
5) Undervaluing Your Product Or Service
Many new business owners are afraid to charge money for their products and services.
This can be a costly mistake as it means you are selling yourself short. It is essential to research the market, determine what people are willing to pay for your product or service, and set prices accordingly.
Remember you are providing something of value and should charge accordingly. Don’t be afraid to ask for what you are worth. The market determines what you can charge for your products/services, not your emotions.
Is a home business right for you?
Home-based businesses have many benefits. The added income can be a great way to supplement your salary, and you can work from home with flexible hours. However, there can also be many drawbacks.
The Negatives Of A Home-Based Business
It Can Be Lonely
Running a home-based business is different than working in an office. It can be challenging to stay motivated, and you may feel isolated. It’s essential to find ways to build a support network. Join home-based business networks, take online courses, and attend seminars.
You’re In Charge
For some being in charge is the dream, but it can also be scary. You are responsible for all aspects of the business; if something goes wrong, it will be up to you to fix.
Boundaries Become Blurred
When you become a business owner, it can take over your life. You must be careful not to let it seep into your home life and personal time. It’s important to set boundaries and ensure you are taking the time for yourself and your family.
The Advantages Of Home Businesses
Control Over Your Schedule
As a business owner, you have complete control over your schedule. This can be a double-edged sword. While it gives you freedom, it also requires significant self-control. There isn’t a superior telling you to get back to work (both good and bad).
Low Start-up Cost
Home-based businesses are some of the cheapest companies to start. You can get started with just the basics – a computer, a phone, and an internet connection. Home-based businesses are ideal for those who have limited start-up capital.
You Are A Role Model
Running a home-based business can be inspirational for your family. It shows them that hard work and dedication pay off and you can be an example of what is possible when you follow your dreams.
Tax laws in your jurisdiction may allow you to write off some of your home business expenses. This can save you a significant amount of money at tax time and make it easier for you to invest in your home-based business.
No More Commute
With a home-based business, you can leave the daily commute behind. This means more time to do what you want—no wasted hours in traffic or making excuses for being late.
What are the disadvantages of a home-based business?
Some disadvantages of home-based businesses include potential distractions, limited space, and lack of access to resources such as printers and fax machines.
Is it good to have a home-based business?
Yes, home-based businesses can be a great way to make money and have more control over your work life. With the flexibility of working from home, you can take advantage of lower overhead costs and remain competitive with other businesses.
Just make sure to create a workspace where you can focus on tasks without distractions and establish good business practices to help you succeed.
A home-based business can be an excellent option for those looking to start their own business without investing in expensive overhead costs.
However, it’s essential to understand the potential disadvantages of this type of venture and take measures to ensure your home-based business runs smoothly.
With careful planning and dedication, you can set yourself up for success and make a home-based business work for you.
Mike lives in Japan, where he owns and operates several businesses, including a restaurant and an online marketing agency. When Mike isn’t dreaming up his next venture, he is writing on his site Mykhumphrey.com