How To Make Sure You Are Ready to Start a Home Business

It would be worthwhile to understand that the temperament, attitudes and goals of a "typical Business person" and a "Home-Business person" are not and need not be similar.

When you get into business, making money is necessarily implied. But besides money, there are several things that you should be clear about before venturing into a home business. Since I have been a home businessman for the past 15 years, I am fairly qualified to present my point of view on this matter.

1. Do you possess the specific skills, expertise, knowledge and (preferably) some experience in the line of your proposed business?
   
   In home business, YOU are the prime investment. You have to build up the business and sustain it mostly by virtue of your skills and expertise. You must have the correct perception about your capabilities versus the demand in the market and you should not plunge in based on hopes rather than reality.

   When I started my Design Services, I was clear about my capabilities and specific strengths about my area of expertise based on my past experience - Machine Design. I had Software development as a second option to fall back on, just in case I faced difficulties in my desired line of business.

2. Do you have the financial strength to withstand the possible loss or absence of revenue during the initial periods of business?

   If you have huge loans already (home loans, vehicle loans, etc.) that you have to repay and if your past savings do not look impressive, then you are treading on a very dangerous path.

   When I started my venture, we were on a joint family account and until then my father had taken care of managing my finances very judiciously. I had no loans to repay. I had a good amount of savings that could pull my family through safely for a couple of months. I had the money to invest in my computer and related equipment without going to a bank for a loan. And my father was always ready to chip in in case I crossed any line of danger.

3. Are you sure you can continue in your field for a reasonably long period of time without getting bulldozed by the fast changing technology, or possible change in customer tastes, preferences and needs?

   In IT related business the danger of becoming obsolete will always be lurking behind you. Many times you have to keep running in order to stay in one place. If you do not constantly update yourself, younger people with knowledge on the latest advancements will overtake you.

   The line I had chosen was fortunately one where the technological changes are slow to take place and in whatever areas the changes came, updating myself was not a huge task. However, the second option I had chosen - software development - was different. It came in very handy when my parent Industry - machine tools - faced a slump. But, within a couple of years the platform on which I developed my software (MS-DOS) was out and Windows was in. I was not at all ready nor was I studious enough to update myself on the change in trend. Result? I had to drop away from the software line once for all.

4. Are you ready for the low-profile, adventure-less, glamour-less way of life mostly associated with the home business?

   Are you ready to do most of the drudgery yourself with little prospect for delegation until you are reasonably established?

   Until you are stabilized, your are the boss, your are the typist, you are the office-boy and you are the delivery boy! You have no Top-executive meetings at 5-star hotels, nor performance oriented incentives to spend an all-paid holiday in Switzerland!

5. Are you aware that a home business may give you less of an opportunity to make any "big money"?
   
   As long as your business is constrained to home, your income will also be constrained to certain limits. You can not compare yourself with your old colleague who has by now become Executive Vice-President and owns a chauffeur-driven limousine. You can not compare yourself with your next door Shopping-Mall-Owner who has his own bungalows in every country he visits!
6. Are you prepared to be glued to a desk, confined within the house most of the time?
   
   If you are the type who can not sit in one place continuously for 15 minutes, who loves traveling, hitch-hiking or globe trotting, home business is not for you.
7. Are you capable of tackling the multiple roles you have to play other than the core area of your expertise?
   
   You have to know about Tax Laws, Credit and debit, Balance sheets and PL Accounts, VAT, Service Tax and numerous such things over and above your core area of expertise. Until you can afford to utilize the services of consultants by paying through your nose, you have to manage all the paper work yourself. Sometimes it may even eat away at the productivity of your main business!
8. Are you prepared for the reality that it is YOU who have to make decisions, produce the output, and face the consequences of wrong decisions, inefficiency, etc.?
   
   You don't have a boss who can make decisions; you don't have a colleague on whom you can put the blame. You don't have a team to share the burden of work when you go on a holiday. You must be the one-and-all.

Running a home business may not be a cake walk for all. If your expectations are moderate and if your life-style is tuned towards simplicity and mental peace, then there is every possibility that you will enjoy running a home business.