There are tons of home based business ideas you can adopt, and choosing the right one may not be easy, however, knowing what to look for in a home based business will definitely make things much simpler.
The following is a set of 7 questions which you should be asking yourself to determine the type of home based business you truly desire and worth putting your focus and effort in.
1. How much startup capital am I willing to invest in my home based business?
Budgeting is very important, and you should always set aside an amount of cash flow for emergencies.
When determining the investment, it should be an amount you are comfortable with to start your home based business. It does not necessary mean that you have to invest the full amount, but rather as gauge to filter out high costing home based business ideas.
Since you will be working from home, you need not pay the high cost of rental for office space and depending on the business you are in, possibly no management of employees and salary required. Most of your investment will most likely go into purchase of raw materials, services and marketing.
There are other on-going variable costs you need keep track such as bills, purchase of raw materials and etc. And you should be splitting your household expenses and that for work related for tax purposes.
2. What is the Risk level of the home based business I’m comfortable with?
Home based businesses vary in risk levels, and you should determine the amount of risk you’re willing to take. Risk can be due to return on investment, product fulfillment, natural disaster and more…
Higher risk business not necessary will always give you a better return. There are home based businesses that are low cost and risk level but still make you tons of money.
3. Do I want to deal with physical or digital products?
Product fulfillment is very important in a business. It determines the customers’ trust on your home based business and how much you can be making. You have to be prepared for cases where the product failed to deliver, product damaged during delivery and refund request.
Thus, you have to decide whether you want to deal with physical products that needs to be delivered, or digital products that can be downloaded from the website directly after payment.
4. Do I want to target global or local customers?
Depending on the type of product or services you are providing, you can be targeting either local or global customers. Of course, this will also depend on how you handle payment and product fulfillment. Should you be leveraging on the Internet to target global customers, you need a website that accepts credit card payments. On top of that, you must be ready to handle larger orders.
5. Do I have the knowledge or experiences in this industry?
You need not be an expert, but at least some knowledge is preferred before you jump into an industry. Always do your research to find what is in demand before you waste all your money, time and effort.
Keep a lookout for partners or mentors who are more experience, whom you can leverage on to guide and assist you towards your success in your home based business.
6. How much time am I willing to spend on this home based business?
Time management is important, especially when you are your own boss. There are home based businesses that require a lot of your time, and those that requires lesser time but giving same result.
If having more time freedom is one of the reasons you want to start your home based business, then you should be looking at home based businesses where you can outsource most of the work and put it into automation.
7. Do I want to get paid once or many times per sale?
If you are dealing with membership or subscription types of businesses, then you would have a ready customer base that will purchase from you regularly from your one time marketing effort.
Alternatively, you could also be in a home based business that you market frequently and make money on every sale made.