In today's economy, more and more people are choosing to work from home for several reasons. First, because people are simply choosing to leave the corporate world and bosses behind. Second, Uncle Sam provides tremendous tax advantages to home business or brick and mortar business. Finally, people seek the flexibility that owning your own business can bring. So with all that in mind, what kind of business do you start.
There are a few options when choosing to start a home business.
There is franchising such as owning a McDonalds or Subway. The benefit to owning a franchise is that it is a business in a box. You have corporate partners that help you launch your business, and are there to follow up with you. The downside is that your business requires you to be there at first. The success of your business not only depends on you, but on employees as well. Business author Robert Allen, suggest that when operating a business, there is much to be said for employee resistance. I will cover that in future articles.
Perhaps you have a favorite hobby or skill. You can leverage those talents by starting your own brick and mortar business. This is a dangerous proposition because of the high probability that you may be out of business before you really even get started. Michael Gerber call this an Entrepreneurial seizure. You may know a lot about your business, but not a thing about operating a business. Laws are very complex. You need to be able to hire and fire, file taxes, balance books and the list goes on. You are responsible for marketing, building upkeep, and Inventory control. Whew! With all that it may sounds better to go work for someone else. But thats not for us, is it?
Next, there is direct sales. Direct selling is great because you are getting paid for moving others people inventory. You generally set your own hours, have minimal start up costs, and carry no inventory. Most products can be drop-shipped. The downside to direct selling is that if you don't work, you don't get paid. You may be able to earn a living, but your pay is based solely on your efforts. I like direct selling for the simple fact that it can give you time freedom and provide you with a nice income. Unfortunately you don't have total leverage with this type of business unless they following a network distribution model.
Similar to Direct Sales, network marketing thrives when other people move product. Network marketing is not only great for the independent business owners, but for the company as well. If you choose to retail products, then you will get paid commission on products you sell. The benefit of network marketing is that you can build an organization by sponsoring other associates. When you sponsor a new associate, you can earn commission on their volume as well. Companies like Kraft, McDonald's, and Wal-Mart spend Millions of Dollars marketing and advertising products before they are even sold. Companies that operate with a network marketing model, do not spend money on advertising until the products are actually sold. The money spent on advertising and marketing is actually paid directly to the independent business owners. Additionally, there is no need to carry inventory or employees. This industry provides training and support to help you achieve success. There are a lot of Network Marketing companies out there and knowing which one to represent can be challenging. Before making a decision, I typically suggest you ask yourself this questions, "Are the products consumable?" If the answer is "yes" then there is a good chance you will have repeat orders. I typically suggest companies like Watkins, Herbalife, Scentsy, Avon, or Mary Kay. These companies are not fly-by-night network marketing companies, and they are time tested. I really like Watkins because they are the oldest direct selling company around (142 years), and they have the broadest range of superior products.
No matter what type of business you choose you should ask other business owners how difficult it was to start their business. A little research will go a long way. Good Luck and until next time!