By upending nearly every aspect of society, Covid-19 has created opportunities for a vast range of new businesses, from personal protective equipment vendors to cleaning companies.
This website is dedicated to showing people how to start a home-based business with limited funds. Thru different guides, I will explain the nitty-gritty of launching a home-based business.
Brian is a business owner with 50+years of experience being self employed and, as such, offers lots of incite into what it takes to start your own business..
I guess most people starting out expect it to be impossible to start their own business. Not so, but there are a few things you need to think about before you proceed.
I guess most people naturally start out hoping to grow into a big company making tons of cash. If you have the knowledge, backing and support to start big you will probably want some help from the SBA (Small Business Association). Especially if you want government financing. If you go this rout, be prepared for a ton of paperwork.
On the other hand, if you are just starting out, and want to test the waters first, things will be a lot less complicated.
Will you need a business or occupational license? Each State and each municipality has their own rules. Stay under the radar at first by getting input from others in your field about what is needed.
For instance, in 1980 in Florida, in order to become a home builder, you had to have a builder’s license which required 5 years of provable experience or a college degree of some kind. Then you had to pass an exam administered by the local authorities.
But, in Pennsylvania, there is no testing and no occupational license needed unless you make over $5,000.00 / year. (Subject to change, so don’t take my word for it).
You will be expected to keep good records and pay the appropriate taxes, both personal and business income taxes.
Will this be a part time or full time adventure?
Is there a market for what you want to do?
Many hobbies can be turned into a business where you earn quite a good living. The good news is that if you have interest in a particular subject, than transforming it from a hobby to business is quite easy and this website will start to show you how.
If you have tools that you are using in your hobby, you are ahead of the game already.
The kind of tools that you will need for your business will depend on the type and size business you are planning. If you want to start a small woodworking business for instance, then having simple hand tools will prove to be adequate. On the other hand, if you wanted to have a large scale production then you would need to plan on purchasing heavier machinery. Make sure that the space you plan to use is adequate.
You need to clearly marke out your niche. You might need to copyright any products you make to avoid cases where people can steal your ideas for their own benefit.
If you are going to be selling items, you will need a “license to collect tax” from your state.
If you are using a fictitious name (something other than your own 1st or last names), that will have to be registered with your state.
Make sure you advertise. Know that you are no longer doing your hobby just for the fun of it. There are many ways that you can advertise your business. These days, EVERY business uses the internet in one way or another. Using the internet means you will need you to put up a website. A website allows you to display any products or explain the extent of your services without the need for a store-front or office. With the website you will be able to tap into potential markets that extend far beyond your local neighborhood. More about websites later.
Of course you can also make use of word of mouth. Inform your friends and neighbors of your business. This is a very inexpensive way of getting your word out there.
Perhaps have flyers or door-knockers made up to pass around you neighborhood.
Use the internet to get check on your competition, to help determine what you need to do to keep competitive in this ever changing world.
Sole Proprietorship, LLC ( limited Liability Corporation ) Corporation and NonProfit.
When my brother and I went into business, we chose an S corporation, thinking it would shield us from personal liability. We soon found out, as a new business, all our creditors required that we sign for debts “Personally” so it really was not worth all the hassles involved with incorporating….setting up a board of directors, having quarterly meetings, and filling out the quarterly reports. The income tax responsibility for S Corps flows through the corporation to the shareholder and shows up as income on their taxes. For this reason, S corps aren’t subject to corporate income tax. So it’s the same as a Sole Proprietor as far as taxes.
Nonprofits‘ members and directors are shielded from personal liability for the nonprofit’s actions.
As a nonprofit you’re eligible for state, federal and certain other income tax exemptions.
| A note to our visitors|