Financing a Home Based Business

Financing a Home Based Business

abstract person with moneyFinancing tends to be one of the biggest challenges when launching a home based business. Even if you expect your start-up and monthly operating expenses to be minimal, it may still be challenging to find the money you need. If a traditional business loan isn’t an option, you might want to consider simpler financing options that you can create on your own.

For example:

Take a look at your assets. If you own things, you can sell them. Jewelry, rugs, furniture, time-shares or second properties are just a few examples.

What about your car? If you drive a nice, late-model car, you can sell it and lease a less expensive one without a down payment.

Borrow against your home. If you have established equity in your home, it should be very easy to borrow against it. Keep in mind though that once the loan begins, you’ll have monthly payments. Or, you may want to consider refinancing your mortgage with a new one.

Friends and family. Friends and family may be willing to support your business start-up. If you do chose this option for financing, be sure to put your agreement in writing so that it’s official and there aren’t any miscommunications that can cause a problem down the road.

Borrow Against Your Investments. If you plan to continue working full-time while you start your business, consider borrowing against your 401(k) or other retirement plan.

Consider a low interest credit card. Credit cards are a quick and easy method of funding your start-up and can help build business credit at the same time. You can start with deferred payments or a minimum monthly payment until your business starts to generate income.

Regardless of the financing option you chose, be responsible and keep your financial security at the forefront of your mind. If you’re determined to succeed at your new venture, investing in yourself is the way to go!

Financing a Home Based Business

What's In A Name?

One of the first steps for every entrepreneur is to choose a name for his/her new business but deciding on the right name can be tricky. Your company’s name needs to be memorable and it also needs to convey what type of service or product you’ll provide to your prospective customers. Not to mention that there are also several legal issues to consider.

Some business owners believe that the best names are the most creative ones while others think that a company name should be descriptive and informative. In my experience both types can be effective if the name is backed by the appropriate marketing strategy and partnered with a descriptive tagline and logo.

For example, when I launched my Homeowner Referral Network (HRN®), my husband and I created a list of potential names for my new business until we finally hit upon the name “Home Remedies”. I loved the name instantly but didn’t want prospective customers to think that I was in the business of selling homeopathic medicine. In order to explain my services more clearly, I worked on developing a descriptive tagline to partner with my business name along with a logo that incorporated the shape of a house or tools.

If you’re launching a new business and are trying to choose a good name, you should first decide on what you’d like to communicate to potential customers. If your name is more descriptive than it will be easier for you to explain what type of service or product you provide.

Next, try to pinpoint what type of image you’d like to establish for your company. For example, do you want your business to convey a local, hometown feel or do you want to be perceived as a larger corporation? The typeface in conjunction with your business name and logo will the first impression you make on potential customers.

If you’re having difficulty deciding on a name, you can brainstorm by making lists of adjectives and keywords that best describe your business and pairing them together. If your name is recognized in the community or you just want to give your business a more personalized feel, you can try including your first or last name in your business name. There are also several websites like http://www.rhymer.com/naming.html that can help offer name suggestions. Once you have a list of your top choices, share them with family, friends and industry related professionals to get their input.

And finally, keep in mind that your name shouldn’t be too long. If people can easily pronounce your name or understand it when it’s spoken, they’ll be more likely to say it.

Once you’ve narrowed down your list to 2-3 possibilities, be sure to check with your state government to be sure that the name isn’t being used by another business. And, if you plan to operate your business in other states or nationwide, you should search the US Patent and Trademark website (http://www.uspto.gov/index.html) to be sure that the name you’ve chosen doesn’t infringe on any existing trademarks.

Financing a Home Based Business

Essential Tips for the "Lifestyle Entrepreneur"

What’s a “lifestyle entrepreneur”?Image preview

Lifestyle entrepreneurs are business owners who know how to work efficiently so that their business doesn’t infringe on valuable personal time or family responsibilities.  For a home based business owner in particular, this can be a challenge.

Whether you’re  considering the launch of a home based business or if  are already operating one, below are three essential tips that will help you incorporate working from home into your busy lifestyle:

1. Define Your Hours: Take a look at your schedule and pinpoint the hours of the day that you’re able to devote to your business. If you’re a “morning person”, plan to wake up one hour earlier to work. If you prefer to work in the evenings, go to your home office after dinner or after your family has gone to bed. Need to schedule work hours around a full time or part time job? Call forward your business line to a cell phone and return calls during your commute to and from work or during your lunch hour.

2. Use The Internet: The Internet is a phenomenal tool for a home-based business operator. It allows you to promote your business 24 hours a day and communicate with clients even when you’re out of your office.

For example, if you launch a website for your business set up a form with an autoresponder message so that potential clients can contact you at any time and receive an immediate response via e-mail.  And, if you collect names and e-mail addresses of visitors to your site you can follow up with a monthly or quarterly e-newsletter.

3. Work Efficiently: No matter how many hours you have to devote to your business, use your time well. If you’re only able to work 1 or 2 hours per day, focus your energy on the money-making aspects of your business and outsource other business responsibilities that require a particular area of expertise such as web design, copy writing, accounting, etc.

Finally, if you feel that you’re time is too limited, consider launching your home based business with a partner and divide business responsibilities based on your individual talents.

Financing a Home Based Business

Tips For Finding A LEGITIMATE Home Based Business Opportunity

If you have an entrepreneurial spirit and the desire to work from home, a home-based business opportunity can be a great option.  Business opportunities provide you with a turnkey system and support so that you can be in business “for yourself, not by yourself”. Unfortunately, a multitude of unscrupulous companies have cropped up on the internet over the past several years, making the search for a legitimate home based business a bit of a challenge.  The good news is that there are legitimate and profitable home based business opportunities out there and if you’re able to identify certain “red flags”, it won’t be that difficult to eliminate the “scams” and spot the opportunity that’s right for you:

Red Flag #1: You visit a business opportunity website and there are pages of copy promising financial freedom and personal wealth but it doesn’t tell you anything about what the company does.  If a company doesn’t clearly state their product and/or service, be wary.

Red Flag #2: The company website states that you’ll make unrealistic amounts of money, with minimal effort, in a very short period of time.  This is simply not true.  Businesses take time to grow.  If any business opportunity website promises that you’ll be a millionaire in 3 months or less, ask yourself, “If there was a way to get rich overnight, wouldn’t everyone be doing it?”

Red Flag #3: While there may be several testimonials of successful business owners listed on a business opportunity’s website, you still need to ask for references and contact them by phone or e-mail.  And, if a company isn’t willing to provide references, they’re not legit.

Red Flag #4: Once you’ve found a business that interests you, request additional information.  If the company asks you to provide a credit card number or to pay a fee—no matter how small—it’s a scam.

Red Flag #5: Ask how your business will make money.  If your ability to make money relies on you recruiting other people to sell a product or service, the company is most likely a multi-level marketing business and, in most cases, the only people who make legitimate money with MLM’s are the people at the top!

Finally, keep in mind that when you do find a business opportunity that feels like the right fit for you, don’t fall in love too quickly.   Take the time to research your market for competition to be sure that your area isn’t saturated with a similar product or service.   And most importantly, make sure that the business capitalizes on your strengths and talents and allows you to do something you love each day.  It’s a well-known fact that entrepreneurs who love what they do are much more likely to succeed!

Financing a Home Based Business

Ready To Launch A Home Based Business?

If you’re still thinking about launching a home based business but need a little motivation, ask yourself three simple questions:
1. Do you enjoy working with people?
2. Have you experienced your own frustration finding reliable contractors?
3. Are you looking for a way to make more money for your family?
If you answered yes to any of the above, then it’s time to launch an HRN®!

With 300+ successful referral networks operating across the US and Canada, the HRN business has become a cottage industry of its own for one simple reason—there is a universal need for this type of business.
No bells, no whistles.
Most homeowners can relate to the challenge of finding reliable home improvement professionals and good contractors want reliable job leads. And HRN’s fill this need in the home improvement marketplace.
Best of all, the HRN business has low overhead and tremendous profit potential!
And, with the spring home improvement season just around the corner, the timing couldn’t be better!
So what are you waiting for?